As politicians and countries maneuver to keep steel mills and other factories at home, the companies are maneuvering to maintain their competitiveness through automation. Voestalpine AG’s fully automated steel wire plant has only 14 jobs, but they are “really attractive.”
For the past several decades, labor-intensive manufacturing of textiles and clothing has shifted from higher wage countries to lower wage countries, and in the process helped bring jobs and economic growth to increasingly poorer countries. With advances in technology and automation, however, that regular shift to the next country with lower pay levels may be coming to an end.
India is now the best opportunity for smartphone growth, but Apple has only 3 percent market share there. To compete with cheaper Chinese and Indian phones, Apple has begun offering older models at discount prices.
A ten-person shoemaking startup in Maine is trying to keep the craft of hand-sewn footwear profitable in the era of globalization.
Twenty-five years ago, U.S. chipmakers vowed to stop using chemicals that caused miscarriages and birth defects. And they did—by outsourcing the danger to women in Asia.
In the 1980s and 1990s, a series of studies in the United States showed that workers at semiconductor manufacturing facilities had abnormally high rates of miscarriages. The US industry responded by trying to eliminate many of the most noxious chemicals, improve working conditions, and shifting semiconductor manufacturing to other countries. More recently, the handling of highly toxic chemicals in semiconductor plants has also been associated with a number of other health problems, including cancer, infertility, and birth defects in the children of male workers.
An obsession with building factories that make "things" that could be more efficiently produced in other countries could be counter-productive to improving the economic health of working-class Americans. The highest paying jobs, and the most valued added, come from the early stages or product design and development, and the latter stages of customer service and support. Policies that would encourage companies to invest in low-margin manufacturing operations, rather than other activities, could hurt their overall competitiveness and lead to prices increases for U.S. consumers.
Caterpillar has been a symbol of U.S. manufacturing worldwide, with its equipment in use in probably every country. The company is also known for its ability to deliver parts to repair the equipment, wherever it is being used. Where the profits on those parts should be booked, and taxes paid, however, is now under scrutiny.
General Motors is posting record profits even as its major rivals are moving to lower investors' expectations. CEO Mary Barra's heavy focus on profitability, and operating margins in particular, has led her to scale back or entirely abandon investments in emerging markets like India and Russia, although those markets represent many millions of annual vehicle sales. She says that GM won't win by being all things to all people everywhere.
Mary Barra may be leading GM away from its past as she focuses on a profitable future. GM is leaving some markets to focus on high profit margins and investments that will position it for a period of rapid change in the auto industry. In addition to changing the company's strategy, this focus is also changing elements of GM's culture.
GM was once the leading global automaker with a presence in all of the major and emerging markets. But CEO Mary Barra has decided to ditch low profit-margin markets like India and Russia to focus on more profitable markets and invest in being a leader in new technologies.
An Iranian immigrant in Silicon Valley is challenging the $500 million behemoths and touting night shots that pierce cloud cover. Spy-quality satellite imaging for cheap.
Comac, or Commercial Aircraft Corp. of China Ltd., is planning to compete with Boeing and Airbus in the aircraft industry. Comac's model C919 took its first flight last week from Shanghai. The Chinese domestic market for aircraft of this size, a single-aisle model that can carry 158-174 passengers, is expected to be more than 5,000 aircraft over the next 20 years.
The role of unions in Mexican factories is a bit different from the standard procedure in the United States. Before a factory even opens, a contract is signed between a local labor union that will represent workers and the factory's owner. Dues are paid by the factory, and many workers are not even aware they are members of the union.
Despite record profits, BMW is perceived to be falling behind in the fast changing world of electric cars, self-driving vehicles, and robo-taxis. So the company's CEO is putting employees through a day-long session to raise awareness of the challenges and to instill fear of falling behind.
China is fast becoming one of the larger markets for workplace automation. This has led to the development of a large number of Chinese companies in the robotics and automation industries, though many currently just assemble components designed and manufactured by leading German, American, and Japanese robotics companies. But in the process, these companies and Chinese central planners are working to create a competitive robotics industry in China.
Diversity and promotion of minorities at Rockwell Automation's has improved as a result of actions designed to change the attitudes of its largely white, male staff. Employees take training programs that encourage them to better see the world, and the company, through the eyes of minority employees. Employees are sensitized to recognize attitudes and behaviors that cause minorities to feel unwelcome.
Some 800 robot makers seek scale as Chinese industry automates. JD.com, E-Deodar, and Midea lead China’s charge for domination. It has also deployed a pollution-monitoring robot and a deep-sea robot.
Manufacturing of dentures and dental implants has become more automated and is increasingly done in low-wage locations. A combination of the use of digital technology, consolidation among dentists, and lower costs overseas has contributed to a shift in production of dental fixtures. U.S. manufacturers that have remained competitive have shed jobs by investing in automation.
China is the world's largest auto market, and most cars are sold under a foreign brand name. This is a result of China's policy of requiring foreign car makers to work with a joint venture partner, and in the process transfer some technology and manufacturing expertise. As the Chinese government considers dropping this restriction, it could hurt local manufacturers who have come to depend on the profit streams from foreign-branded vehicles.
The shipbuilding industry has taken a significant hit in recent years, as low oil prices decreased demand for oil tankers and offshore drilling rigs. There is now a bit of hope, however, as demand for liquefied natural gas is driving demand for gas tankers. Demand for electricity in India and China is boosting demand for clean electricity-generating technologies, hence demand for liquefied natural gas from the Americas.
In early 2016, Carrier announced it would be closing a furnace factory in Indiana and shifting production to Mexico. In a mature manufacturing industry that requires minimal skilled labor, the two primary ways to reduce operating costs are to increase automation and/or lower wage costs. One approach to lowering wage costs is to shift production to lower wage locations. In Carrier's case and in the words of its CEO, the timing happened to coincide with the "silly political season" that was short on "adult supervision." The Indiana plant, however, will for now remain open.
Beginning in the 1990s, Alabama used tax breaks and other incentives to attract foreign auto manufacturers to the state. As multiple auto companies built factories in Alabama, auto-parts makers followed. Questions about safety violations and working conditions at these auto parts factories raise questions about potential costs associated with Alabama's manufacturing renaissance.
KentuckianaWorks trains young adults and displaced blue-collar workers with sought-after advanced manufacturing skills. Its success illustrates the relationship between human resource management, education, and training. It also illustrates the shared needs of workers, employers, and society.
After pulling Chevrolet out of Europe in 2013, prospects for General Motors there have not improved. Now GM has agreed to pay French automaker PSA Group to take Opel and Vauxhall Motors as it exits Europe.
Nuclear power looked like a promising business when Toshiba acquired Westinghouse Electric in 2006. Now cost overruns and delays at the only nuclear plants under construction in the United States since 1979 will cripple, if not bankrupt, the once formidable industrial conglomerate.
Data mining by traditional brick-and-mortar fashion retailers is not a new thing, but third party data tracking in the internet era is creating advantageous data that can lead to better targeting. Le Tote, a fashion rental service that uses products from such traditional retailers as the French Connection, collects data on the level of satisfaction of their customers (who pay a fee for their service) and now partners with the retailers to help meet the needs of consumers in a tailor-made way.
Slaughterhouses and meatpacking plants are not the most enjoyable places to work, and while the pay typically exceeds minimum wage, employers have a hard time attracting and keeping employees. In order to keep operations running and meat prices at levels customers have come to expect, plants have increasingly turned to immigrant and/or refugee labor. With the recently announced travel and refugee ban, many workers that had hoped to build a life in America and bring their families to join them, now wonder if they can ever achieve the American Dream, and meat processing plants wonder if they will be able to find enough workers to fill the jobs.
Athletic footwear makers may bring some manufacturing back to the United States to save on shipping and perhaps avoid a Trump Twitter tirade. But the factories are likely to be highly automated and create few jobs.
The manufacturing of sneakers has been a labor-intensive process, and thus, much of the manufacturing has taken place in low-wage nations. With changes in design and new manufacturing techniques, it may be economic to move some production closer to markets. This will reduce shipping costs, while shortening the time to market and making it easier for manufacturers to quickly respond to shifting demand.
The supply chain in the automotive industry is incredibly complex, with parts coming together into subassemblies and then joined with other subassemblies before being assembled into final vehicles. Under NAFTA, regardless of the North American country where final assembly takes place, most vehicles are made from parts manufactured or assembled in the other two countries and other countries worldwide. Simple-minded ideas such as imposing a tax on imports from Mexico sounds like a way of shifting manufacturing to the United States but may result in fewer U.S. manufacturing jobs if auto manufacturers shift production outside NAFTA to lower prices for consumers.
The Chinese auto industry has been growing steadily for 26 years, with foreign luxury brands such as Audi doing very well. The market is shifting, however, as other luxury brands such as Mercedes are experiencing faster growth. Meanwhile, there is also pressure for more fuel-efficient, electric, and hybrid vehicles. Thus, Audi dealers are finding it hard to make a profit, while Audi seeks out additional sales channels to spur growth.
China is the world's leading steel exporter, and in the process has driven down worldwide steel prices. The Chinese government is now trying to restructure its domestic steel industry, closing smaller producers. This should help the country reduce air pollution while giving some financial relief to other steel makers.
Leading apparel retailer Zara rejects the label fast fashion because of the company's focus on design. Yet its designers are driven by sales and consumer data as they deliver fresh styles to stores twice weekly.
Inditex's business model for fast fashion allows it to frequently update its inventory and adapt its offerings to different tastes in different countries. Rather than rely on lead designers to try and predict or create fashion trends, the company uses data and a team of designers to continually shift production at its factories. Since a large portion is produced near the Inditex's headquarters in Spain, new designs can move quickly into production and onto store shelves in Europe.
The fall in the value of the ruble, along with real wage declines, has contributed to a boost in Russian exports of some manufactured goods. Although the cost of doing business in Russia is still higher than in many other countries, it is very competitive with eastern Europe, and exporting to Europe can make sense for goods with high transportation costs. Both IKEA and Samsung have recently expanded production at factories in Russia.
The North American automotive industry is highly integrated across Canada, the U.S., and Mexico, with parts and vehicles flowing back and forth across borders. All that could change if Donald Trump follows through on his threats to levy import taxes and cut trade with Canada and Mexico. The implications for automakers from Ford to Toyota to Volkswagen are significant, as are the resultant rise in prices of that U.S. consumers would face.
Porsche plans to have a high powered all-electric coupe out by 2019, just in time for the EU’s tough new carbon emission standards for 2020. Porsche’s Mission E will also growl like a Porsche.
Following the April 2013 collapse of the Rana Plaza building in Bangladesh, multinational companies and the government are trying to improve factory working conditions.
Google's new high-end Pixel smartphones will compete directly with Apple's iPhone, but also with Samsung and HTC and the rest of Google's Android partners. Google says it will treat its new hardware division just like the other Android partners and is confident it can keep it all together.
Canadian auto parts supplier Magna International is developing a concept car with autonomous driving and emissions-free technologies. It is positioning itself to be the contract manufacturer for automakers, old or new, seeking to introduce such vehicles.
Any company considering entry into the auto industry will likely be in contact with Magna International. Magna makes a variety of components that go into most autos, and operates assembly lines that produce cars for certain auto companies. It is currently exploring how it might create a platform that companies considering entering the auto industry could use as the basis for their vehicles.
Egyptian cotton is known for its long fibers that help make fabric particularly smooth and comfortable. Many retailers and brand name designers proudly label their bedding as being made with Egyptian cotton. Unfortunately, given the small scale of the Egyptian cotton production, it is simply mathematically impossible for all the bedding labeled as Egyptian cotton to actually have come from Egyptian cotton. As cotton goes through the various stages of production, it is common for cheaper varieties to be used. Now steps are being taken by retailers and designers to have the cotton they purchase be marked, and then subsequently tested, to make sure they are ending up with fabric that uses the cotton they paid for.
While there have been shifts in manufacturing over the past few decades, there are still opportunities for manufacturing to thrive in developed countries such as the United States. Globalfoundries' facility in New York makes semiconductor wafers and employs 3,000 people with an average salary of $92,000. 9to5 Seating, a Calilfornia-based chair manufacturer, exports quality components from its U.S. factory to China, where assembled chairs are then sold in markets such as Saudi Arabia and China.
Family owned and managed for over 100 years, New England Paper Tube was driven into receivership after 3 decades of losses in the face of foreign competition. Under new ownership and lead by the former production manager, the company has returned to profitability by focusing on the products where it has competitive advantage, like mortar shells for fireworks and the military.
Foreign sales are becoming increasingly important to U.S.-based defense contractors. Many Asian countries are ramping up their defense spending, while U.S. defense spending on new systems remains relatively flat. As part of a proposal to win sales in India, Lockheed-Martin and Boeing have both indicated that they will manufacture fighter jets in India rather than simply exporting them from the U.S.
Business incubators, accelerators, innovation labs, and a smorgasbord of other entities exist to create or jumpstart entrepreneurial endeavors, but a recent trend of note is to help existing small businesses take their goods and services to the next level.
An unexpected occurrence offered the founders of Yasso, a five-year-old company with an already established market in the northeastern United States, an opportunity along with a decision to expand. The business now earns $50 million in sales.
Precision Castparts had strong stock performance under CEO Mark Donegan, until a rough time in the oilfield services business led to a big drop in the company's valuation. Seeing a buying opportunity, Berkshire Hathaway purchased Precision Castparts. The culture at Precision Castparts was one of strong pay-for-performance, but where failing to make the numbers would lead to a verbal thrashing or being fired.
Pickup trucks have been banned in most Chinese cities in order to lessen congestion and air pollution. Relegated to use in rural areas and on farms, sales of pickup trucks have been limited. Domestic manufacturers Great Wall Motors and Jiangling Motors have dominated the market, with limited imports from Ford and Toyota. A recent loosening of regulations, however, may be good news for foreign truck manufacturers.
In 2013, Wal-Mart announced a plan to encourage more manufacturing in the United States. Pledging to spend $250 billion over ten years on "Made in America" products, the goal was to entice companies to shift about 250,000 jobs to U.S.-based factories. While the results suggest that products can be efficiently manufactured domestically, with the program leading to an increase in U.S. manufacturing, the number of workers hired has not likely met the projections.
Detroit Bikes is helping to bring manufacturing back to motor city. But the economics of making bicycles in the U.S. are challenging.
A U.S. district judge’s recently issued injunction highlights challenges in determining the cost-benefit trade-offs associated with mandated disclosures. The injunction blocked implementation of a new Department of Labor regulation that would require companies to disclose payments for more types of anti-unionization consulting services. While unions argued that the regulation would increase transparency and “level the playing field,” the judge decided that the expanded scope of disclosures could adversely affect the availability of legal advice regarding responses to union-organizing campaigns.
Despite its glamorous first-class accommodations and superjumbo capacity, the Airbus A380 has been a financial disaster. Little interest from airlines other than Emirates could force Airbus to kill the program.
Kevin Plank, Under Armour’s founder and CEO, has many ambitions for his company. These include intertwined business and social objectives of becoming world’s biggest sportswear company and revitalizing the city of Baltimore. A passionate and visionary leader, Plank consciously seeks to use the company’s momentum to shape Baltimore’s future.
By 2018, Tesla will need to double the annual global production of lithium ion batteries. In moves reminiscent of Ford’s River Rouge, Tesla has integrated battery production and is making moves to control supply of the minerals needed.
The first U.S. foreign direct investment in Cuba is a startup that will make tractors for small farmers. The international new venture could solve a significant problem in Cuban agriculture, if the farmers can afford to buy them.
These five substances offer opportunities for secondary innovations that can make a myriad of products perform better.
While Cuba has significant agricultural potential, one of the things holding back agricultural production is a lack of modern farm equipment. Now two U.S. entrepreneurs are hoping to change that by operating the first U.S.-owned manufacturing facility in Cuba. The tractors will be of a simple and adaptable design and targeted for operations on the relatively small farms of Cuba and other developing nations.
Takata’s travails continue as the recalls of its airbags expand. Takata was the only airbag manufacturer to use ammonium nitrate, a chemical with well-known stability issues, as a propellant. Takata’s corporate culture and leadership help explain the decisions that led to the continued production of potentially lethal products and the largest auto recall in history.
Importing pigs that are considered delicacies in Spain but relatively unknown in the United States can be a bit of a risky proposition. Two men in Texas believe that it is worth investing $3 million of their money to build a specialty market for these cured hams.
Purchasers of Tesla's electric vehicles are often looking to spend $40,000 or more on a car. In surveys of Tesla shoppers, the other brands they were most likely considering were BMW, Toyota, Audi, Honda, and Mercedes-Benz. U.S.-based brands such as Cadillac, Chevrolet, Jeep, and Dodge appeared far less often on the shopping lists of Tesla customers.
Investments in energy efficiency can take years to pay back from cost savings so are often rejected by CFOs. But framing them as a portfolio with returns of over 20 percent convinced Adidas to invest millions per year.
Germany's Borgward auto company was founded in 1924 and at one point was responsible for 60 percent of the country's auto exports. By 1961, however, it had gone out of business. Now the brand is being revived in China, with a Borgward SUV being manufactured by Chinese truck-maker, Beiqi Foton.
Last year, watch exports from Germany rose 14 percent, while Swiss watch exports fell 3 percent. Part of the difference in magnitude is driven by the significantly smaller size of the German watchmaking industry, but underlying economics help explain the trends. As the euro has fallen in value relative to the Swiss franc, German watches are relatively more affordable.
As the technological world shifts to phone and portable methods of operation, the PC market has been dwindling. Mass manufacturers need to use their capacity for new products, and 3D printers seem to provide a new growth oriented market.
Founding a business and developing its brand is a lifetime task for many entrepreneurs. Letting go and passing it on to family is sometimes a far more difficult task.
The Impossible Project aims to revive the business of making instant film and cameras that once put Polaroid at the top of the tech world.
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China is the world's largest car market, and the luxury segment is growing quickly. While Mercedes, BMW, and Audi have done well in capturing market share, other competitors are trying to pick up a portion of this lucrative market. In January, General Motors opened a Cadillac plant in Shanghai, which will help it avoid import taxes of about 25 percent. Ford is also opening specialized showrooms for its Lincoln brand, offering the same level of customer service as a five-star hotel.
Tesla has busily developed a defensible position in high-end, electric-powered automobiles. With an inelastic demand curve as it relates to oil price fluctuations, their resilience is sound in that sector, but now they have to deal in a sector that is more affected by oil prices. Chevy is also interested in the sector, adding to the complexity in behavioral competitive issues.
Samsung and LG have been successful selling NCM batteries (nickel, cobalt, and manganese) for electric vehicles in China, with much of that success related to generous subsidies the Chinese government has provided to electric buses. A goal in stimulating the use of electric buses is to decrease pollution in China's cities. The government will continue providing subsidies, but only to the less expensive LFP batteries (lithium-iron-phosphate), which are available from a number of Chinese suppliers.
Two leading companies in the mining industry are in a partnership to develop the largest copper mine in the United States. The copper is located at depths that make mining the ore very expensive and hazardous. But the profits based on anticipated yield could be huge.
Honda’s new CEO, Takahiro Hachigo, is working to eliminate quality control problems and rebuild the company’s reputation. He's already reshuffled Honda’s executive ranks and plans to raise domestic output by 30 percent, to 950,000 vehicles, by 2020.
Under previous CEO Jack Welch, General Electric was highly successful as a diversified conglomerate. Jeff Immelt, who took over in 2001, has shifted the company's focus from financial services and home appliances to industrial products and associated software. He also has implemented cultural changes.
At a Brooks Brothers sewing factory in Long Island, New York, more than half the employees are over fifty-five years old, and the average tenure is thirty years. These older, highly skilled workers have the ability to make ties by hand or perform custom tailoring that can quickly supply stores in New York City. In order to help retain these older workers, Brooks Brothers has established a set of human resource management policies that appeal to veteran employees.
The oversupply of many commodities in China has driven down related prices, impacting both local economies and global stock markets. In particular, steelmaking capacity in China keeps rising despite government pledges to cut production and end easy credit.
For decades, Intel has had a dominant position in microprocessors while Samsung has had a strong position in memory chips. Now the two firms are positioning themselves to take bites out of each other’s primary chip markets.
Intel and Samsung, the world’s No. 1 and No. 2 chipmaker, respectively, have successfully dominated different segments of the market for years. Competitive forces are now causing them to increasingly go head-to-head for the same customers.
Apple is well known for its differentiation on design and software. Less well known is that Apple spends billions to design its own chips for the iPhone and iPad.
The National Highway Traffic Safety Administration has developed a crash test dummy that measures 7 times as many variables as the current standard. Not only that, there is an implication that it can also provide more accurate measurements as well. They sent out for bids to produce this test dummy, and the winner was Humanetics Innovative Solutions. The contract could be quite lucrative, at $400,000 per unit.
With the integration of Eastern European countries into the European Union, large disparities in wages across the EU became evident. As a result, many Western manufacturing firms started shifting labor intensive manufacturing jobs to Eastern regions. Meanwhile, many Eastern workers started looking westward for higher wages. The result of those two trends has now led to low unemployment in Eastern Europe, and companies are struggling to find enough workers for factory jobs.
Walter Liew spent decades collecting information about DuPont's proprietary process for producing titanium oxide, a compound used to make things white. Much of the information that he obtained came from disgruntled former DuPont employees. While DuPont has elaborate security processes designed to protect its titanium oxide process, Liew's success shows that former employees are a potential point of vulnerability for trade secrets. Corporations may find it valuable to maintain the loyalty of former employees, especially those with sensitive knowledge.
The multinational agreement regarding Iran's nuclear program has opened the door for many foreign firms to pursue business deals in Iran. Not only are many foreign business leaders visiting Iran, but on a recent trip to Europe, the country's president, Hassan Rouhani, closed deals with several European firms. Most American firms, however, still have significant restrictions on what they can do in Iran.
Chinese appliance-maker Haier has become a major global competitor but, after fifteen years of trying, has yet to establish a strong position in the United States. Now it has acquired one by agreeing to pay $5.6 billion for GE’s appliance unit.
Haier, a China-based manufacturing firm, is buying General Electric's appliance business for $5.4 billion. While General Electric appliances are well known in United States, the company has done little to expand its appliance business internationally. Haier has made some inroads in the U.S. market and expanded in other markets both through growth and acquisitions. This acquisition will help Haier move from a small to significant player in the U.S. appliance market.
The success of small, independent coffee roasters signals a strong demand for their processes and products. Craft beans are following the path of craft beer.
As prices and mortgage rates rise, builders are trimming home sizes and cutting prices -- including offering homes starting in the $200,000 range -- to lure young buyers.
Apps have made it relatively common to have remotely controlled systems in the home. Unfortunately, these systems can be hacked, creating massive losses both financially and even physically. Dojo, a cybersecurity system domiciled in Israel and designed to pick up on hacking attempts on home systems, has garnered over $1 million in seed money for their solution to this problem.
By merging then breaking up into three companies, Dow and DuPont can achieve focus and scale at the same time. That should finally make their activist investors happy.
Amazon’s boom year means a swell in temporary workers, which cuts into profit -- though not as much as putting them on staff would. The weekly price of Amazon’s holiday help is $70.4 millon.
Everlane’s approach to business has been characterized as more "missionary" than "mercenary." The online retailer sells fashionable shoes, clothing, and accessories, but also discloses details about the factory where each item is made and the costs of production.
Nineteen million Takata air bags have been recalled, and despite the seriousness of the safety issue, it may take four years to replace them all. The problem may be compounded by both additional recalls and the financial challenges facing Takata as carmakers stop ordering the company's air bags. While Takata and car manufacturers face challenges related to this recall, car owners are the real losers of this protracted process.
Small numbers of manufacturers now control the market for many common hospital drugs. Limited production and shortages have resulted in sustained price increases of 100 percent and more.
Entrepreneurial businesses are sometimes like trying to climb a rock wall, but in this case the business IS creating and manufacturing the rock walls.
Indoor rock climbing gyms are being opened worldwide, and the world's largest builder (Walltopia) comes from an unlikely location - Bulgaria. Two and a half hours outside Sofia, in the small town of Letnitsa, is a factory that has supplied walls to gyms in more than 50 countries. Through a combination of cheap labor, innovative designs, and willingness to develop custom walls for clients, Walltopia has gained a loyal worldwide customer base for their climbing walls.
Wavestorm of Taiwan has become the surfboard industry leader by selling soft surfboards for $99.99 exclusively through Costco. Some say WaveStorm is killing the industry with low margins. Others hope it will expand the market and lead to eventual growth in sales of higher-end boards.
A Taiwanese manufacturer and a Canadian toy executive joined forces to make a low-price surfboard that’s a best-seller in the U.S.
Glencore, a global mining company based in Switzerland, recently announced it will lay off more than 4,000 workers at mines in Zambia. During the shutdown, the company will spend money on improving the mining operations to try and cut operating costs. But for most workers, as well as the communities that supply goods and services to the mine workers, what had been a bright spot in a bleak economy will be dimmed.
Legislation in the United States has encouraged automakers to explore new technologies to reduce vehicle emissions and increase fuel economy. While some automakers have turned to hybrid and electric vehicles, Volkswagen chose to invest in what it termed clean diesel technology. In many ways, this was simply building on Volkswagon's strengths and investments in diesel engines, but when the technology couldn't quite get the company to the point it desired, a few lines of code were used to trick the emissions tests.
Fiat Chrysler’s tentative agreement with the UAW will increase its employee wages across the board. Nevertheless, by avoiding a cap on the number of newly hired workers that it can employ, Fiat Chrysler will continue to enjoy a labor cost advantage over the other Big Three automakers. Unionized workforces make automakers’ compensation and other human resource management issues subject to labor union negotiations. Thus, the ability to successfully negotiate labor agreements with an eye toward developing strategic advantages is an important dimension of human resource management for Fiat Chrysler and other automakers.
Keeping production cost low is important for any firm, but inbound and outbound logistics within the linked value chain have powerful impacts as well. Infrastructural components can create advantages and disadvantages in the global market.
Apple claims 90 percent of the smartphone industry’s profits. Although other firms offer very competitive phones, so far they seem to be eroding one another's positions -- not Apple's.
In the ultra-competitive smartphone manufacturing market, Apple gobbles up close to 90 percent of industry profits, while Samsung takes the majority of the rest. So why do the other manufacturers continue to compete?
Apple reigns supreme in terms of profit share in the smartphone industry. However, if the worldwide market shifts to lower-priced models, as expected, it is uncertain whether the firm's high profit margins can be sustained.
Strong demand from China drove high prices and robust investment in commodity materials for over a decade. Now China’s slowing economy has the increased supply meeting lower demand, and many industries are awash in materials.
The prices of commodity metals, such as copper and aluminum, are driven by a combination of fluctuating demand and much less volatile, large-scale production that adjusts slowly. When the Chinese economy was booming in the earlier part of this century, it generated strong demand for metals, causing prices to substantially rise. Companies such as Glencore and Alcoa were incentivized to invest in new mines and processing facilities. This additional supply is now coming into the market just as Chinese demand is dropping, causing commodity prices to fall.
The European Union has made a point of separating governments from ownership in companies, and many previously state-owned companies are now public companies. There's a regulation in Germany, however, referred to as the Volkswagen law, that has allowed the government to maintain a direct ownership stake in the company—a so-called "golden share"—that gives it significant say in the operation of the company. Now that Volkswagen has admitted to rigging the software in many of its cars so that they appear to be more efficient and cleaner than they actually are, there are questions as to whether the unique ownership structure of Volkswagen helped allow this situation to come to pass.
Stop the bleeding is always the first priority in an accident. Sunaris, a three-year-old company headed up by Joe Landolina, has found a way to inject the bleeding area with a mesh-type material that dramatically reduces bleeding time. The product is currently finding success in the veterinary market. It uses an algae base that creates a scaffold to which the blood coagulates. The product is said to be the only of one its type to stop arterial bleeding. Sunaris will start human testing soon and see no reason why its product will not be available within the next few years.
Shoemaking companies in Portugal are performing well financially as they move up-market. While they can not compete on price with Asian manufacturers, they can compete on quality and have found a profitable market position between high-end Italian shoes and lower-priced Asian models. Some have also added their own brands while continuing to operate as contract manufacturers for more famous labels.
As an expatriate, being assigned to lead sales in the largest and fastest-growing international market would seem like a good thing. For Citroen's Sabine Scheunert, the dream job has turned into a real challenge as China's auto market has cooled. The downturn has led to dealerships needing to offer significant discounts to move inventory, and Scheunert's challenge is amplified due to evolving consumer preferences.
When Diebold CEO Andy Mattes assembled his management team at Diebold, he decided it didn't really matter where people lived and didn't expect them to move to Canton, Ohio, where Diebold is headquartered. Thus, various senior managers live in cities across the country and have regular conference calls. Since many executives spend much of their time traveling anyway, Mattes decided it was more important to hire the best people rather than the best people willing to move to Canton.
Growth in China’s market of 400 million smartphone users has almost flattened, leaving manufacturers scrambling.The decline is particularly bad news for Chinese smartphone maker Xiaomi, which has been dependent upon the rapidly growing domestic market.
E-Nable designs 3D-printed prostheses for children older than 3 and shares its blueprints so they can be made for as little as $30. This way, the prostheses can be easily replaced as the kids outgrow them.
Fiat Chrysler CEO Sergio Marchionne is shifting gears in terms of the firm's strategy. Out is Ferrari and in is Maserati, which Marchionne envisions as the linchpin of his $52 billion plan to turn Maserati, Alfa Romeo, and Jeep into global brands and boost net income fivefold.
Shigenobu Nagamori started Nidec in 1973, and turned his small motor-making business into one of Japan’s most profitable multinational corporations. Nagamori, who has been recognized as one of Japan’s top business leaders, has an uncommon leadership style: He emphasizes motivation, dedication, and hard work over talent and intelligence.
DuPont has completed the spin-off of its major chemical operations. The new company, Chemours, inherited thirty-seven active chemical plants with products that generated 19 percent of DuPont's revenues. Chemours also inherited 62 percent of DuPont's environmental liabilities. The spin-off raises questions about DuPont's responsibility to meet obligations arising from decades of pollution.
Porsche is expecting China to become its largest market this year, but customers are starting to choose slightly cheaper models.
Two competitors, two different strategies in Russia.
As labor costs rise in China, Indonesia tries to attract manufacturers.
The U.S. State Department and multinational retailers are taking steps to address human trafficking and poor working conditions in Thai factories.
Human trafficking and migrant laborers have cast a shadow on Thailand's tuna industry.
Should new autoworkers be second-class citizens?
The company is spending billions on factories and state-owned rivals.
Gallium nitride promises to replace silicon as the semiconductor of choice in transistors.
The booming market for autos in China has caused automakers to expand capacity faster than the demand warrants.
Old European ships find their way to scrapyards in India, working around EU regulations.
Kansas City's Sub Tropolis, a subterranean industrial park, takes advantage of natural energy and climate advantages to attract tenants.
Rising wages in Cambodia cause multinationals to look elsewhere for cheap labor.
Xiaomi, which raised $1.1 billion in December, is pouring money into its own investments.
Chinese car dealerships battle with car makers over growth and margins.
If you can't have everything between your ears, you can at least have it all in your ear.
Will electric vehicles become a thing of the past? Toyota has a vision that its hydrogen vehicle will become the first mass-market hydrogen car.
Zara Home is helping propel growth at the world's largest retailer.
Outsourcing has been taking place for longer than most U.S. college students have been alive.
An engineer has developed a 3D-printing plastic he claims can be used to print electronics.
Bangladesh exports leather, but the environmental and health costs remain local.
Bangladesh's $1 billion leather export industry is hazardous for workers.
Bangladesh has a $1 billion leather industry. Unfortunately, safety and sustainability are not priorities.
India is becoming increasingly attractive to manufacturers, although it is still in need of infrastructure improvements.
Android Lollipop and new Nexus devices will have trouble drawing buzz away from Apple.
Fiat CEO Sergio Marchionne has big plans to gain a position among the small number of large global automakers.
Fiat CEO Marchionne says his expanded company will boost sales 60 percent by 2018. Analysts are doubtful.
Fiat tries to reconfigure its product lineup to find the right niches in markets worldwide.
Low cost auto factories in Eastern Europe create a jobs and export engine for the region.
China's exports of military equipment are growing, as it provides easy-to-use, inexpensive arms to developing countries.
Australian exports of coal and minerals to China are falling, while exports of beef are rising.
OSHA hopes that publicly disclosing workplace injuries will motivate employers to improve safety.
All you have to do is wave my business card next to your tablet or laptop to find out all about my business.
Interface, which has reduced the proportion of unrecycled nylon in its carpet production by almost half, believes sustainability is its best long-term strategy.
Interface's sales are growing as it makes progress toward eliminating waste and meeting other sustainability goals.
Rising transportation costs and wage rates in China are causing firms to relocate manufacturing to the Southeast U.S.
Manufacturing is slowly returning to the U.S. -- and much of the action is in the South.
How have tax incentives and labor costs affected the location of new manufacturing plants in the South?
Erik Buell Racing, maker of powerful trophy motorcycles for the rich, will add low-priced bikes made by Hero MotoCorp of India to its line next year.
India’s largest maker of two-wheeled vehicles is investing $25 million in Erik Buell’s latest bike venture.
Toyota and Tesla had high hopes for their jointly developed electric RAV4. But they’ve sold fewer than 2,000 of the SUVs. Toyota, whose homegrown electric RAV4 was discontinued in 2003, is distancing itself from Tesla’s focus on all-electric vehicles and embracing fuel cells, a technology Tesla founder Elon Musk ridicules.
GE’s new FastWorks program could enable it to do business faster, cheaper, and better and make lean startup the next big management innovation.
Ethiopians make $40 a month stitching shoes. Their Chinese counterparts make more than $400.
Labor costs in Ethiopia are approximately 10 percent of those in China, causing some Chinese companies to shift production to Africa.
Microchips for cars are a large market poised for strong growth, but big chipmakers like Intel and Qualcomm are just getting started.
The ouster of American Apparel's CEO shines a light on the company's uneasy balance of idealistic social responsibility with a variety of transgressions.
The next car an American purchases—even if it has a German or Japanese brand name—might just be made in Mexico.
Despite mounting losses, Sony is increasing spending on R&D and releasing new products like the SmartBand, which it hopes will be the next big thing.
Sony lost $1.3 billion last year and continues to spend on research and development. Are Sony’s actions a testimony to a long-term vision or a design for short-term collapse?
Intel has staffed up its plant in Vietnam by sending local students to Oregon for college-level training.
Volvo owner Zhejiang Geely is investing $11 billion to revive Volvo’s popularity, especially in the U.S. where sales fell 55 percent in the past decade.
Growing middle-class populations have exploded global demand for dairy products and given U.S. dairy farmers their best performance in decades.
Although some companies opposed the Dodd-Frank conflict mineral provisions, Intel worked for years to make its global supply chain conflict-free.
A new Philippine customs commissioner is cracking down on bribery and corruption.
Hazardous garment factories provide one of the only ways out of poverty for many Bangladeshi women.
Working in poor conditions in the garment industry has helped raise the living standards of many women in Bangladesh.
HTC’s chair and co-founder has stepped in to revitalize the company but isn’t advocating for radical changes.
Skeptics question a government program designed to help U.S. manufacturers sell to foreign buyers.
Troubling allegations raise questions about Samsung's responsibility for its employees' illnesses and deaths.
Convertibles, long a symbol of fun and freedom, are going the way of the Model T.
Pampers brand is especially important to P&G because it lets the company forge ties with moms, the company's "core customer."
China now accounts for more 25 percent of global luxury spending for U.S. brands, and U.S. sales are growing faster in China than pricier European luxury lines.
According to hundreds of government filings analyzed by Bloomberg, 18 percent of companies have reduced the amount or delayed payment of 401(k) matching funds and dragged out vesting schedules. For many, that could mean the difference between financial security and scarcity in old age.
Should the mortgage-interest deduction for yachts be repealed, and how much in tax revenue will it save if it is?
Can Lenovo compete with Samsung and Apple?
How likely is it that the “promise zones” President Obama is proposing will make a difference to communities within them?
Factory jobs are going, going, gone.
Although many people think the return of lost manufacturing jobs is just what the United States needs, most experts would disagree. Across richer countries, growth has been accompanied by a decline in the number of manufacturing jobs and a rise in the number of service jobs.
Are you looking for a Chevy or a BMW? The three major German auto manufacturers are introducing luxury sedans at lower prices than some mainstream U.S. cars.
Samsung’s goal for your kitchen is simple: It wants to own it by 2015.
Manufacturing output in Syria has shrunk as the civil war has shuttered (and bombed) factories.
China's rising labor costs drive multinational firms to shift production priorities at Chinese factories.
Since the 1993 introduction of the Airbus A340, soaring oil prices have dried up demand for the large capacity plane with four Rolls-Royce engines. Airbus took a big risk by guaranteeing the plane's resale value, a move that is coming back to haunt the company now.
The big draw for foreign investment in Mexico is no longer just availability of assembly line workers. Skilled engineers are one reason carmakers have invested nearly $13 billion in Mexico in the last three years.
Cisco is struggling to sell its pricey telepresence systems next to upstarts’ $10 monthly software subscriptions. Will its lower priced systems and new subscription-based model compete effectively against its new rivals?
Despite Apple's code of conduct and supply-chain audits, workers in the company's supply chain fall victim to excessive recruitment fees and other mistreatment.
To move up market, Electrolux is changing how it develops new products.
Would you like condoms, cigarettes, or a chicken burrito? With traditional grocery stores sales falling, Tyson Foods now wants to leverage the marketing channel power of the more than 149,000 convenience stores in the United States.
Getting more personalized retail offers based on your preferences and shopping history is closer than you think.
While many still see shale oil as the path to U.S. energy independence, there are signs that it may not be an easy or inexpensive path.
IRII is using celebrity backing to bring change to Haiti's apparel industry and the lives of its workers.
After years of looking at foreign companies as sources of capital, technology, and managerial know-how, China appears to be specifically targeting European and U.S. multinational companies in a crackdown on anti-competitive behavior.
The next stage in innovation and new productivity gains could lead to higher revenues and lower costs.
In just six years, upstart Chobani has grabbed first place in the Greek-style yogurt U.S. market. After being blindsided by the upstart, Danone is using its marketing heft to regain the lead position.
Construction outsourcing can help companies reduce costs by as much as 20 percent.
For Chinese factory managers, reducing energy costs is an economic imperative, but it may also create environmental and health benefits.
Outsourcing large components of buildings or factories can cut costs and improve quality.
Scrap wire and metal from the U.S. are being shipped to China for recycling and reuse.
Only 10 companies in the S&P 500 have carried out stock splits this year, compared with an annual average of 48 since 1980.
Biometrics companies are benefiting from a potential iPhone fingerprint scanner.
Analysts believe Chinese automakers are about a decade away from delivering their first globally competitive vehicle. Great Wall may be the company to pull it off.
Abundant natural gas in the U.S. is driving investment in chemical, plastics, and fertilizer plants on the Gulf Coast.
The wreckage of Asiana Flight 214 on the San Francisco Airport runway may look bad, but the low number of casualties is a testament to improvements in airplane safety, a culture of learning from accidents, and the effectiveness of shared responsibility for safety.
Dhaka, a city of 18 million, has more than 3,500 garment factories.
Caterpillar is reporting record profits. Its CEO has been rewarded by steep increases in compensation. Should the company's employees benefit, too?
How should multinational companies respond to deplorable working conditions in Bangladeshi factories?
Will clear communications from Bernanke help avoid market disruptions when the Fed finally allows interest rates to rise?
Homebuilders face rising prices of everything from plywood to drywall as buyers return to the market and increase demand for housing.
Even though its move to Alabama will increase manufacturing costs, Airbus recently broke ground on its first U.S. manufacturing facility.
At less than $3,000, the Tata Nano may be too cheap.
The value of global takeover and merger announcements in March was the lowest since July 2009. Why do some think a sharp rebound is coming soon?
The yen falling 16 percent in the last five months translates to about an additional $1,500 cost advantage per each car made in Japan.
Europe's carmakers want to close five factories and cut 30,000 jobs. With a long history of worker protection and labor laws that support workers, those tasks won't be easy or quick. Even if they pull it off, it may not be enough to restore profitability. Some experts think it will take closing ten factories.
Apple sells a lot of electronics, but can it sell the iWatch?
Computers may have feelings after all.
Could a car’s quirky design that is still cultishly worshiped online be adequate to help it survive?
Is the battery dead on your phone? Switch to your PC and continue the fun.
Satisfying our craving for chocolate is likely to be more expensive very soon.
Are you ready for an office update?
Can you taste the difference?
It turns out that traditional, Weberian bureaucracy as a form of enterprise organization has supporters.
Are TVs making a comeback?
The most populous country in the world will soon see its huge labor force begin to shrink. The current fast track toward industry automation may be the key to continued wage increases and moving Chinese manufacturing companies up the value chain.