Mexico Continues To Be The Top Choice For Nearshore Manufacturing

Reflecting continued rising labor and other manufacturing costs for imports from faraway places like China, nearshoring continues to be seen as an opportunity to serve U.S. demand by about half of senior executives of manufacturing-oriented companies.

While 35 percent of that number view manufacturing inside the U.S. as the most attractive choice for such reshoring, up from 21 percent in a similar survey a year ago, 50 percent view last year's top choice, Mexico manufacturing, as the No. 1 choice again this year.

Results from the Manufacturing Re-shoring and Near-shoring Outlook Survey, released by global business advisory firm AlixPartners, also suggest that rising domestic demand in developing countries such as China may encourage even more nearshoring and reshoring in the West in the future as companies in those developing markets redirect their capacity toward local consumption rather than export. More than a third of the executives surveyed — 34 percent — predict that will be the case.

As in last year's survey, lower freight costs and improved speed-to-market were the two most-cited advantages expected from the decision to nearshore. Twenty-six percent of respondents also cited lower inventory costs as the biggest expected advantage, up from 20 percent last year.

Source: thefabricator.com