UK manufacturers begin to relocate production lines

After the financial crisis, the manufacturing industries in the developed countries began to return to the mainland, and the high-end manufacturing industries in the United States performed particularly well. The latest news shows that not only U.S. manufacturers, but also British manufacturers are moving the production line to similar moves.

According to a survey of nearly 300 companies by the manufacturers' organization EEF and Hanyu International Law Firm, one-sixth of UK companies have "returned" their production lines in the past three years. This is a slight increase from the one-seventh of the 2009 survey.

EEF said that this trend will continue, and 6% of the companies stated that they plan to “backflow” the production line in the next three years. The EEF stated that this increase was "very gratifying" and the survey showed the benefits felt downstream of the supply chain - one-sixth of companies stated that they replaced their purchase targets with suppliers from the United Kingdom. However, this proportion is still very low. The British government is launching a service to help businesses return.

Examples of business returns include: SYMINGTON'S, a food company in Leeds, England, moved its noodle production base from Guangzhou, China back to Yorkshire. HORNBY, a toy model toy manufacturer, recently moved the production of aircraft components from India back to East Susek. County. It is worth noting that the EFF survey found that companies have moved production lines back to their home countries, mainly because they want to improve the quality of their products and spare parts. 35% of companies mentioned this reason. Followed by the elimination of uncertainty, increase delivery speeds, and hope to reduce transportation costs. 23% of companies mentioned the risk of supply chain disruption.

Only 16% of companies stated that the loss of labor cost advantage is an important factor. Wages in China and other countries have been rising, but there is still a huge gap with the West. The manufacturing cost per hour in Western Europe is about 15 times that of China. China is still the main area where companies move production lines, followed by Eastern Europe. The interviewed companies pointed out that the main obstacles to expanding manufacturing in the UK are high energy costs and lack of skills.

EEF hopes that the British government promises to keep British energy costs at or below the EU average to maintain this return momentum. The organization also hopes to see the UK make greater progress in reforming its skills and apprenticeship structure.