"It's not a question of whether other countries are competitive or not," Huntsman, brother of former U.S. presidential candidate Jon, said in an interview. "They're not."
Power isn’t the only reason the United States is becoming so attractive to manufacturers again. Average labor costs in China have more than doubled since 2007 to around $2 per hour, while they’ve risen less in the United States to around $18 per hour, with worker productivity far higher in the United States, according to U.S. government statistics. When you factor in the cost of shipping goods from Asia, it’s little wonder that America has re-emerged as one of the most competitive places to build stuff.
That’s a dramatic change from just a few years ago, when Germany was held up as a model of manufacturing prowess. As recently as 2011, politicians in Washington were openly discussing how to copy Germany's success.
"We need to be more like Germany," General Electric Chief Executive Jeffrey Immelt said in an interview that year with Reuters.
Now things are heading the other way. German Chancellor Angela Merkel's energy policies - designed to sharply boost the share of renewables in Germany’s energy mix, tackle climate change and cut Germany’s dependency on foreign gas and oil - are a rising source of concern for the country’s industry, particularly energy-intensive companies like Wacker.
According to Germany's Chamber of Commerce and Industry, half of the country's industrial companies believe their global competitiveness is threatened by Germany's energy policy, and a quarter of them are either shifting production abroad or considering doing so. The United States is among the top destinations.
Tuesday, June 3, 2014
Special Report: How fracking helps America beat German industry
This is a big, big deal. I told you all in 2011 that Natural Gas was THE NEXT BIG THING.