Manufacturing may be coming back to the United States, but it will never be what it once was. Manufacturing is changing for the future, and top executives at some of the nation’s biggest companies laid out the future of the industry in a discussion at the Forbes Reinventing America conference on Thursday.
“This is not just about the return of manufacturing,” said Charles Peters, senior vice president at diversified manufacturer Emerson. “We have to recognize that the global manufacturing game has changed. We like to talk about shift.”
Thanks to cheaper energy costs at home and rising wages in places like China and India, manufacturers are starting to re-shore jobs they sent overseas in the 1980s and 1990s. Wal-Mart saw the trend and made a promise to buy $250 billion of American-made products over the next 10 years.
If America will compete against the rest of the world, it must come up with smarter products, and U.S. companies are using data to turn old, Rust Belt legacies into new business.
Take Wabash National, maker of semi-truck trailers. It’s no longer about just putting a big box on top of 18 wheels. Today Wabash is partnering with engine manufacturers and retailers like Wal-Mart to figure out how to move the most stuff the cheapest way.
Wabash is measuring the box of the back of semi-trucks to figure out how it can expand the size of the box while making it more aerodynamic, reducing the cost of transportation. “We think of NASCAR and what they do in determining the air flow and where the drag is,” said Richard Giromini, CEO of Wabash.
The new wave of manufacturing also means rethinking old strengths of struggling cities and reshaping them into new opportunities.
Milwaukee used to be the brewing capital America, but the major beer companies almost all left. The smaller companies that made heaters, pumps, meters and the like for brewers shifted their focus to another drink, water.
The city is now home to 150 water technology companies, more than any other city in the world. Clustering isn’t just for tech firms—Milwaukee has become the Silicon Valley of water. In similar ways, Orlando has made itself into a hub for automation, and Louisiana has turned itself into a state for moviemaking.
“That has moved us from the Rust Belt image,” said Richard Meeusen, CEO of Milwaukee-based Bager Meter. “I think more people can and will reinvent themselves in the same way.”