Opinion Coronavirus Holding up LED suppliers

[WildWestDesigns]

A lot of manufacturing processes create hazardous waste but systems are in place to deal with it so its really a non issue.
IMO, most of the reasons people put forth for chinese manufacturing are nothing but an excuse. Fact is, its just easier to run a business that doesnt make stuff or just assembles. If the easy boat continues sailing away, companies are going to start looking harder at in house production of everything for self preservation. Sourcing from other countries is just a bandaid

With waste, it isn't so much of an issue of can it be done, or can it be done efficiently (or as efficiently as it can be done for the given company), but still the overall cost. Even with systems in place, there is only so much an outfit can do given certain conditions for them.

Not so much easy, although in most instances that is also the case, but it's cheaper and once you starts getting more expensive, that's when alternatives are looked out. Instead of outsourcing to another country, maybe it is outsourcing to another company in country. Then when that gets to a certain threshold, it's bringing it in house etc. Not really band aide, but pure economics of cost.

 

[Notarealsignguy]

With waste, it isn't so much of an issue of can it be done, or can it be done efficiently (or as efficiently as it can be done for the given company), but still the overall cost. Even with systems in place, there is only so much an outfit can do given certain conditions for them.

Not so much easy, although in most instances that is also the case, but it's cheaper and once you starts getting more expensive, that's when alternatives are looked out. Instead of outsourcing to another country, maybe it is outsourcing to another company in country. Then when that gets to a certain threshold, it's bringing it in house etc. Not really band aide, but pure economics of cost.

Chinese products are not nearly as cheap as they are made out to be. Dont get sell price confused with cost. Many domestic products arent expensive to make but end up with gigantic markups. Then run through a bunch of intermediaries who also step on them further increasing the price.
Anymore, companies only want to be in high margin items but it comes back to bite you. Ford and gm are a good example, they backed away from cars. Sales were good but margins tighter and it lowers over all performance metrics. Its fine right now but things change and this same strategy nearly put the 2 of them under in the last downturn.

 

[WildWestDesigns]

Chinese products are not nearly as cheap as they are made out to be. Dont get sell price confused with cost.

Cheap/expensive are relative given the situation. Something may or may not be cheap given the price without any frame of reference, but when stacked up with the cost of doing things in an alternative manor, it may very well be cheap(er) then those alternatives.

China is a hard one to grasp accurate measurements as it's artificially controlled to the nth degree.

Ford and gm are a good example, they backed away from cars. Sales were good but margins tighter and it lowers over all performance metrics. Its fine right now but things change and this same strategy nearly put the 2 of them under in the last downturn.

While they were all hurting, if I recall, Ford was the only one that didn't do a bail out, while Dodge and GM/Chevy did. That to me, would signify, at least at a superficial glance, that they were really hurting more compared to Ford.

 

[Notarealsignguy]

Cheap/expensive are relative given the situation. Something may or may not be cheap given the price without any frame of reference, but when stacked up with the cost of doing things in an alternative manor, it may very well be cheap(er) then those alternatives.

China is a hard one to grasp accurate measurements as it's artificially controlled to the nth degree.



While they were all hurting, if I recall, Ford was the only one that didn't do a bail out, while Dodge and GM/Chevy did. That to me, would signify, at least at a superficial glance, that they were really hurting more compared to Ford.

They were already hurting beforehand. Consumers moved away from the big trucks and suvs because fuel prices were through the roof. They were heavily criticized for it and each went on to refocus on cars. Ford fusion, chevy cobalt and malibu were spawned in reaction to this. Dodge hung their hat on fiat being their small car and failed but theyve always been 3rd tier.
We can argue who was deeper in the toilet all day but they were all in there. Even though ford did not take bailout money, it still helped them by giving creditors and suppliers confidence to continue working with them.

 

[WildWestDesigns]

We can argue who was deeper in the toilet all day but they were all in there.

But you see, that is a very significant thing as that is what helps determine how well the company survives, if it does at all. It is very significant how deep in the shit a company is as to how/if they come back from it. Now, as to if Ford was really better off (and this is relative, they still may be in the shit, but not as deep of shit as the others, that's still relatively better off) or if it was trying to bluff and hold out a little bit longer and see what the others did, I dunno about that.

Even though ford did not take bailout money, it still helped them by giving creditors and suppliers confidence to continue working with them.

Your also forgetting consumer confidence as well. It would help in that regard also. Especially around here. I knew life long Chevy fans that went Ford (I always had Ford, and they were always 3/4 ton diesels or bigger) due to that confidence.

However, even if they weren't in the shit at all, would have the same type of reaction as well from those interested parties.

Ford fusion, chevy cobalt and malibu were spawned in reaction to this.

While I was never in a market for these, they just always seemed more like "puff pieces" if you will. There is a trade off for this types of vehicles. The smaller cars, more efficient cars made by these makers seem not to last as long either. Sure the 1st four yrs may get you great mileage, cheap upkeep, but then everything just starts really falling apart. Not necessary any experience with the vehicles mentioned, just my experience with others having owned vehicles like that in the past and what they complained off (your mileage (pun intended) may very however).


The one thing in instances like this, especially for industries like the automotive, retooling takes time and that hurts things for them in the near term. If market desires/demands comes at them very quickly, adapting to that sudden change, still takes time. That's the biggest thing, how long does it take the entity to retool and adapt to the changing situation.