Beware of Swinging Pendulums

by Austin Weber

My late father was quite a keen observer of the economy and business conditions. One of his favorite expressions was “the pendulum always swings both ways.

It may be too early to make any bold predictions, but theres a chance that the offshore assembly pendulum may be swinging back in this direction. Several years ago, everyone was crying about all the American manufacturers closing their doors and shipping production to China, Brazil and other countries with low-cost economies.

Since then, Ive heard occasional stories about some of those same companies

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quietly boarding up offshore plants and moving production back to the states. But, the following news item really hit close to home the other day, because it affects a plant thats located just a couple of hours away from ASSEMBLYs humble office in the Chicago suburbs.

Mitsubishi Motors Corp. (Tokyo, Japan) announced that it will soon begin exporting vehicles made at its plant in Normal, IL, to China. Believe it or not, when the Eclipse sports car goes on sale in Shanghai this fall, Chinese consumers will be eyeing a car that was assembled in the middle of an Illinois cornfield.

The 20-year-old Normal plant has an annual production capacity of 110,000 vehicles, but its currently building less than 80,000 units. Although Mitsubishi initially plans to only ship around 1,000 Eclipses to China, perhaps it will be the start of a new trend.

If the steep decline of the dollar against the euro continues, we may also soon see automakers start exporting cars to Europe from the United States. For instance, BMW is in the midst of expanding its Spartanburg, SC, plant. That will allow it to boost capacity by 80,000 vehicles a year. Quite a few of those could be headed to container ships in the Port of Charleston.

Source: AssemblyBlog

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