1. The Three Most Essential Words in U.S. Manufacturing
In all the debate around reshoring and offshoring and supply chain, we often overlook three essential words in America’s manufacturing strength: Foreign Direct Investment (FDI). And how does that market look?
Last week, the German-American Chamber of Commerce released its 2023 German American Business Outlook (GABO), surveying 201 German subsidiaries in the U.S. about their 2023 business prospects. The Germans, it seems, are far more bullish on American manufacturing than many domestic pundits. One quote from the report states: “German companies view the U.S. as an attractive investment location due to market size and customer demand, proximity to their customer base, and market stability.”
The German-American Chamber report goes further about future plans for German manufacturing in the U.S.: 22% of respondents expect to invest an additional $10 million in their U.S. plants by 2025, 64% predict growth in the U.S. economy this year and 85% predict a growth in net sales. It is a ringing endorsement for the manufacturing sector. It also is a reminder that the U.S. manufacturing tradition makes it an enticing place for other countries to offshore their own manufacturing, and they manage to do so without hysterical hand-wringing.
2. A FDI Investment Example
One example of the power of foreign direct investment is the recent announcement of a $107 million factory expansion by Ziehl-Abegg, a German manufacturer of ventilation and drive technology. The new plant in Winston-Salem, N.C. will be less than 15 miles from the existing plant, which has seen tremendous growth in the last decade. The company has grown from 40 employees to 230 in the past eight years, and the new plant is expected to bring company employment in the U.S. to more than 800 employees. Joachim Ley, chief operating officer of Ziehl-Abegg, said the project is “the largest single investment at one location in the company’s 112-year history and is the result of the strong growth in quiet, robust and energy-saving fans in the markets in Mexico, Canada and the USA.”
3. Back Home in Hannover
Hannover Messe is very much a second home for me. I have covered this event, the world’s largest industrial trade show, for the last 20 years, and it never has failed to amaze and inform about the trends and technologies in the manufacturing space. It also has been a welcoming city and a comfortable place to spend a week.
I was fortunate to be among just a handful of American manufacturing journalists invited this week to attend the 2023 Hannover Messe press preview. It introduced Indonesia as this year’s partner nation and whetted the appetite of more than 100 global manufacturing writers for this year’s show. The trade show business took a serious hit in the past three years, as did international travel, and so this is my first trip back to the fairgrounds since 2019.
The Machine Design team will be back on site for Hannover Messe 2023 on April 17-21, and we’ll be providing daily reports from this year’s event. For now, though, it’s good to be home.
4. “Making the Difference”
In opening the Hannover Messe Press Preview, Dr. Jochen Köckler, chairman of the Board of Management of Deutsche Messe AG, was every bit as excited as I am about returning to an in-person event at Hannover Messe. “Finally we can get away from the world of videoconferencing and into the trade fair halls,” said Köckler. “It’s like an Olympic Games of ideas, an Olympic Games of innovation.”
Köckler noted key issues continuing to face manufacturing and, by extension, society:
Under this year’s banner of “Making the Difference,” Köckler said the solutions to these issues will be found in the technology on display at Hannover Messe. More than 4,000 exhibitors, including 300 start-up companies, will exhibit on topics that will include:
- Industry 4.0
- AI and machine learning
- Energy management
- Hydrogen and fuel cells
- CO2-neutral Production
5. Digital Twins Connection
During a tour of HARTING’s manufacturing plant that was part of the preview tour in Germany, Dr. Kurt Bettenhausen, member of the HARTING Managing Board for New Technologies and Development, told the media in attendance that the connector company expects to be a major player as the industry moves toward a single standard for digital twins.
“We want to be able to integrate and anticipate product lifespan more accurately,” Bettenhausen said. “We need to be able to update the system more accurately…We don’t have to do everything physically. We can speed up the process, we can test more accurately.
We can make much more accurate decisions. And this is in no way detrimental to our quality decision. We want to shape the process as accurately as possible.”