Wall Street Journal: ‘Made in China’ is fading out

Many foreign enterprises have frowned on China’s policy of mandatory technology transfer and theft of intellectual property

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(Photo from Wikipedia)

(Photo from Wikipedia)

TAIPEI (Taiwan News) – Wall Street Journal published an article titled "'Made in China’ Was Once the Easy Answer. Not Anymore" on Jan. 19 to focus on one point: Executives of some smaller-yet-recognizable U.S. brands have come to regard‘Made in China’ as outmoded, and many have decided to move their production lines out of China as the trade war between the two countries continues to heat up.

“'Sometimes China is the easiest answer’ for companies seeking rapid growth,” Yeti Holdings Inc. Chief Executive Matt Reintjes was quoted as saying.

Reintjes moved some of the company’s production lines from China to the Philippines to reduce dependence on China and still maintain the advantage of having an economical and regional supply chain, the report said.

Reintjes said that, in the past few years, China’s cost of labor has continued to rise, and many foreign enterprises have frowned on China’s policy of mandatory technology transfer and theft of intellectual property, according to the report. The tension was further fueled by the mutual imposition of higher tariffs between the two countries, the report said.

The report pointed out that some U.S. companies have begun to adopt multinational supply chain policies to reduce political, economic, and logistical risks associated with production concentration. Some of them, such as Party City, simply moved their production back to the U.S. to reduce the time needed to ship back their products, the report said.

AlixPartners’ retail department director Bill Lewis said that, as early as 2011, many company owners were examining overdependence on China, and began to feel concerned about a variety of issues, such as labor cost, political suppression, and the rules for operation in China, according to the report.

Lewis said that many U.S. enterprises in China, especially retailers, have had the capability to move their production out of China, and therefore China should come up with better reasons to persuade them to stay on, the report said.