A lot has been written lately about factory and high-tech jobs moving to other countries and the decline of manufacturing in the U.S.
That's true even in the tire industry, where a number of domestic makers are shifting production to foreign plants-many of them in China-especially for broadline tires. Their reasoning? It helps keep them competitive.
On the surface you might think tire industry manufacturing on this continent is facing a steep downhill slide. But that's far from reality.
While some companies see opportunities abroad, others see gold right here at home. Take Japan's Toyo Tire & Rubber Co. Ltd. and Italy's Marangoni S.p.A.
Toyo is spending $150 million to construct the first phase of a tire plant in Georgia, while Marangoni's U.S. unit recently began making Ring-tread precure tread rubber at a new facility in Tennessee.
What motivated these firms to expand their operations here at a time when others are looking elsewhere? The same things that drive all businesses: flexibility; opportunity for growth; and the chance to improve profitability.
For Shozo Kibata, president of Toyo Tire (USA) Corp., the decision to build a factory in the U.S. was based in part on demand in North America and limited global capacity to serve the market.
``We could have gone to China or Mexico or South America, but we felt we needed a quality labor force to go with our advanced (manufacturing) technology,'' he said.
Bill Sweatman, CEO of Marangoni Tread North America, saw no need to look abroad either.
``Outsourcing manufacturing outside the U.S. to reduce costs doesn't have to be the best solution for American companies,'' he said.
Certainly there's risk in building new factories in the highly competitive U.S. with its equally high labor rates. But these companies see opportunity here and are stepping up to the plate. Their bricks-and-mortar commitment is proof of that.