Reshoring: Opportunities and Limits for Manufacturing in the UK – the case of the Auto Sector

David Bailey and Lisa De Propris

Revue d'économie industrielle, 2014, vol. n° 145, issue 1, 45-61

Abstract: ?In recent years, ?offshoring? and ?outsourcing? have transformed fundamentally nationally based auto sectors into global networks of design, production and distribution across the global value chains coordinated by the major automotive Original Equipment Manufacturers (OEMs). As manufacturing activities tended to be shifted to low-labour cost locations in Asia, Africa and Latin America, high-end design, R&D, product development have stayed anchored mostly to high-cost and high knowledge-intensive home economy locations (perhaps with the except of some design and styling activities which are often located in major end markets around the world. However, very recently the weaknesses of and risks inherent in such global value chains (GVCs) have been exposed, triggering attempts to rethink their nature and also raising possibilities to reshore some manufacturing activities to ?home? countries. A combination of a more competitive exchange rate (despite the very recent appreciation of sterling), increased transport costs, rising wages in key areas of China, and a greater awareness of supply chain resilience have all contributed to a perceived change in some business ?fundamentals?. The potential for some supply chain relocalisation also links in with the ?servitisation? of manufacturing including the auto sector and shift to a hybrid model where manufacturing and services are increasingly intertwined. However, there are limits as to how far this can go and these raise some important questions and issues over the possible role for industrial policy.?

Keywords: Manufacturing; Global Value Chains; Reshoring; Onshoring; Rebalancing; Automotive Industry (search for similar items in EconPapers)
Date: 2014
References: Add references at CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
http://www.cairn.info/load_pdf.php?ID_ARTICLE=REI_145_0045 (application/pdf)
http://www.cairn.info/revue-d-economie-industrielle-2014-1-page-45.htm (text/html)
free

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:cai:reidbu:rei_145_0045

Access Statistics for this article

More articles in Revue d'économie industrielle from De Boeck Université
Bibliographic data for series maintained by Jean-Baptiste de Vathaire ().