Made in the U.S.A – Not as Easy as It Sounds

This week the New York Times ran a great piece about how Google is going back to the future with its new home media player, the Nexus Q, making the affordable units not in China or some far-off Asian outpost, but right near the company’s headquarters in Silicon Valley.  Google has even gone so far as to imprint on the back of each unit, “Designed and Manufactured in the U.S.A.”

But the question remains, what does Made in America mean?

As I read the Times story online – and in particular, as I read so many of the reader comments below it – I began to ask myself, how do we actually define which products are made in America, and which aren’t?  If a manufacturer builds its components offshore, but assembles its final products here, are they truly made in America?

Likewise, when a component manufacturer like my company puts dozens of people to work making (in my case) universal joints, which then get sold in multiple countries overseas, where can we say those products which utilize my components actually got made?  In the offshore markets that buy my universal joints, or in the countries of origin where the many components that make up those end products first got made?

But it’s even more complicated than that. 

The Times found Google reticent to speak about the assembly plant it was using for the Nexus Q, to the point that the company spokesman would not even identify its specific address or how many people actually worked there.  It’s entirely possible Google’s plant, like so many in this country, is being powered by state-of-the-art robotics and high-end machinery, and has relatively few onsite workers compared to similar facilities in Asia.

Likewise, it remains highly likely that the silicon chips used to power each unit were made in somewhere in someplace like China or the Philippines and shipped to California for assembly.

And even the consumer reaction to the story was complicated. 

Some readers were praising Google for bucking a trend and re-shoring functions that just a few years ago had been the province of thousands of overseas plants. 

Others were calling it merely a publicity stunt by the company, arguing that the meat of each unit was still being made in China and that the only reason Google was wrapping itself in the flag and claiming the Nexus Q was “Made in America,” was to tap into our growing make-it-here sentiment and sell more units to a proud but otherwise unwitting public.

The story did go on to say that some companies were tired of having to regularly send their managers to China, often for weeks at a time.  Others cited the danger of corporate espionage and the loss of proprietary information and intellectual property, which to many have become almost synonymous with doing business in China.

And others, of course, talked about rising fuel prices, increased labor costs and the uncertainty involved in shipping great distances.  The long and the short of it is; Made in America is starting to matter in this country like it hasn’t in years.

But let’s not for a minute get ahead of ourselves, shall we?  Even as jobs and job functions return to the U.S., some of this country’s biggest manufacturing issues still remain. 

The American supply chain still leaves much to be desired, as something as simple as retooling a screw or the presence of tiny hiccup in one simple variable in the equation can cost a U.S.-based manufacturer weeks, even months, of production time. 

Our schools continue to miss the boat when it comes to training and preparing our kids for the kinds of jobs that are available today and the shortage of which threatens to reach epidemic proportions – so much so, in fact, that much of this whole re-shoring craze could very well be scuttled by a workforce incapable of building and maintaining the machinery at the very heart of where manufacturing is headed.

And international debt and poor money management globally continues to threaten the very essence of the world’s economy – which, like it or not, the U.S. economy is now wedded to for life.

Don’t get me wrong.  I’m delighted by the “retro” manufacturing movement as detailed by the Times, and how critically important companies like Google are experimenting with making core products right here in the good ol’ U.S. of A.  I’m delighted too that manufacturing has gained a cache that it hasn’t had since, frankly, the start of the industrial revolution, or maybe the days of Rosie the Riveter.

But let’s also keep our wits about us, OK?  And let’s not get caught up in election year rhetoric or overly simplistic, trite, little jingoistic phrases like “Buy American” and “Made in America.” 

Take it from someone who knows; in today’s global economy, life – not to mention the business that fuels it – is way more complicated than that.

One Comment to “Made in the U.S.A – Not as Easy as It Sounds”

  1. Pythagoras 9 July 2012 at 2:29 pm #

    In the wire rope business there are three levels of “Made in America” that pertain to selling this product to the government. Level 1 is the best and indicates that all materials were mined, melted and value added in the USA. Level 2 indicates that the raw material could be from another country, but no value adding steps are taken until it hits US soil. Level 3 simply means that at some point the product passed through a US value adding process, in the case of wire rope, a closing operation. As in the case with any government standard there are variations, loopholes and inconsistencies in the application of these standards, yet they are important. Imagine, as most of us have, as you try to land your F-22 on the pitching deck of a carrier, you must have a steady hand, and plenty of faith that one of those three wire ropes that you catch will hold….because it was made in America!

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