More tea leaves…
A caption in my last post pointed out that John F. Kennedy viewed reading The New York Times as perhaps more enlightening than poring over government intelligence reports.
I am not privy to CIA or other such “intel,” but from where I sit so-called “newspapers of record” remain a great source of both hard news and especially news analysis. And in this digital age, you may not even have to fork over a buck or more to read these publications as many, including The Times, make their entire content available free of charge online.
Case in point: A piece by Larry Rohter in the edition for August 3rd, “Shipping Costs Start to Crimp Globalization,“ explains how the massive spike in fuel costs is already leading some global manufacturers to rethink their supply chains including where they manufacture their goods in the first place.
“Many economists argue that globalization will not shift into reverse even if oil prices continue their rising trend,” Rohter writes. “But many see evidence that companies looking to keep prices low will have to move some production closer to consumers. Globe-spanning supply chains — Brazilian iron ore turned into Chinese steel used to make washing machines shipped to Long Beach, Calif., and then trucked to appliance stores in Chicago — make less sense today than they did a few years ago. “
Supporting his argument, Rohter points out that the Swedish-based global home-furnishings giant Ikea opened its first U.S. factory in May and some electronics firms that departed Mexico for the lower wages paid in China are now coming back to our southern neighbor “because they can lower costs by trucking their output overland to American consumers. “
“Made in China” labels may become less ubiquitous due to global fuel costs.
Ah, yes, that word: trucking! Rohter observes that the industries most likely to be affected by the upturn in transportation costs are those producing heavy or bulky goods that are expensive to ship relative to their sale price.
As an example, he states that China‘s steel exports to the U.S. “are now tumbling by more than 20% on a year-over-year basis, their worst performance in a decade, while American steel production has been rising after years of decline.” He says that “motors and machinery of all types, car parts, industrial presses, refrigerators, television sets and other home appliances could also be affected.” And he adds that “industries that require relatively less investment in infrastructure, like furniture, footwear and toys, are already showing signs of mobility as shipping costs rise.”
You don’t even have to read between those lines to see opportunity knocking for truck fleets to haul the inbound and outbound freight these manufacturing plants of all type will generate, right here at home.
Keep your eyes peeled for the right turns ahead!
Email This Post
Related Topics: OEMs, Heavy Trucks, Regulation, Information Technology, Equipment, Management, Midrange Trucks, Light Trucks, Engines, David Cullen, Emissions, Freight, Drivers, Trucking
August 6th, 2008 at 3:26 pm
I believe most people have most likely figured this one out.On the other hand,people that read the Times have most likely not figured it out.
August 7th, 2008 at 7:15 am
Maybe if we get back to making things in the US everyone would benefit. It’s very hard to find a product anymore that say’s MADE IN USA. I’ll pay the extra to keep my neighbors working!
August 7th, 2008 at 2:42 pm
“Information is the oxygen of the modern age. It seeps through the walls topped by barbed wire, it wafts across the electrified borders.”
–Ronald Reagan
Leave a Comment
Advertisement
About
Between the Lines: David Cullen offers his take on how actions taken by government agencies, industry suppliers and other trucking stakeholders impact truck fleet owners. Executive Editor of FleetOwner, Cullen has been covering trucking since 1981 and has been on the staff of FleetOwner since 1989. He does not claim to be an expert on trucking, but will admit to being a writer-- and hoping to be regarded a journalist.Advertisement
Categories
Calendar
Archives
Your Account
Subscribe