Reshoring: An Overview, Recent Trends, and Predictions for the Future

Jennifer Dikler ()
Additional contact information
Jennifer Dikler: KOREA INSTITUTE FOR INTERNATIONAL ECONOMIC POLICY (KIEP), Postal: [30147] , Building C, Sejong National Research Complex, , 370, Sicheong-daero, , Sejong-si, Korea, https://www.kiep.go.kr/eng/

No 21-35, World Economy Brief from Korea Institute for International Economic Policy

Abstract: With the rise of globalization beginning in the 20th century, came the inevitable rise of offshoring — companies moving at least some parts of their operations abroad in order to cut costs and increase profits. In recent years, however, international developments, such as the rise of wages in what were typically considered low-cost countries, coupled with uncertainties created through global political tensions, have incentivized companies to move their operations back to their respective home countries or to make new investments in United States-based facilities. This phenomenon, known as reshoring, has only increased in 2020 and 2021, amidst US - China tensions and the COVID-19 pandemic. Reshoring is growing in popularity particularly among companies based in the United States. In May 2021, for example, a US solar energy systems manufacturer called GAF Energy announced that the company would relocate its operations from Asia to Silicon Valley, expecting to add 400 jobs in research, engineering, and manufacturing roles (Szal, 2021). Around the same time, cycle and treadmill machine maker Peloton announced that it would invest $400 million to build its first US-based factory, citing heightened demand and the pandemic highlighting uncertainties that come with its global supply chain (Thomas, 2021). The company, which has announced that the US factory will be based in Troy Township, Ohio, stated that it expects to create over 2,000 jobs in the area. Also, in May 2021, Ford Motor announced a joint venture with South Korean battery maker SK Innovation to manufacture battery cells for electric vehicles in the United States (Wayland, 2021). The venture will be based in the US, marking a significant decision for Ford Motor, which operates worldwide and has notably been in the press in recent years for its decisions to offshore operations. (the rest omitted)

Keywords: reshoring; relocate; moving (search for similar items in EconPapers)
Pages: 10 pages
Date: 2021-08-19
New Economics Papers: this item is included in nep-int
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3916557 Full text (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ris:kiepwe:2021_035

Access Statistics for this paper

More papers in World Economy Brief from Korea Institute for International Economic Policy [30147] 3rd Floor Building C Sejong National Research Complex 370 Sicheong-daero Sejong-si, Korea. Contact information at EDIRC.
Bibliographic data for series maintained by Geun Hye Son ().