Reshoring:opportunities and limits for manufacturing in the UK - the case of the auto sector

In recent years, offshoring and outsourcing have transformed fundamentally nationally based auto sectors into global networks of design, production and distribution across the global value chains coordinated by the major automotive Original Equipment Manufacturers (OEMs). As manufacturing activities tended to be shifted to low-labour cost locations in Asia, Africa and Latin America, high-end design, R&D, product development have stayed anchored mostly to high-cost and high knowledge-intensive home economy locations (perhaps with the except of some design and styling activities which are often located in major end markets around the world. However, very recently the weaknesses of and risks inherent in such global value chains (GVCs) have been exposed, triggering attempts to rethink their nature and also raising possibilities to reshore some manufacturing activities to home countries. A combination of a more competitive exchange rate (despite the very recent appreciation of sterling), increased transport costs, rising wages in key areas of China, and a greater awareness of supply chain resilience have all contributed to a perceived change in some business fundamentals. The potential for some supply chain relocalisation also links in with the servitisation of manufacturing including the auto sector and shift to a hybrid model where manufacturing and services are increasingly intertwined. However, there are limits as to how far this can go and these raise some important questions and issues over the possible role for industrial policy.

Manufacturing reshoring and its limits:the UK automotive case

This paper explores the meaning of reshoring and its drivers in the case of UK manufacturing and in particular its automotive sector. Drawing on interviews, policy reviews and a range of recent surveys, the paper finds that while reshoring is a discernable trend in UK manufacturing, it is less pronounced than many have claimed and that – in the UK case at least - there are severe limits as to how far this reshoring trend can go, particularly in relation to the availability of skills and finance in the supply chain. This is in turn raises questions over the stance of British policy and whether more could be done, with comparisons made to US experience.

Makespaces: From Redistributed Manufacturing to a Circular Economy

Redistributed manufacturing is an emerging concept which captures the anticipated reshoring and localisation of production from large scale manufacturing plants to smaller-scale localised, customisable production units, largely driven by new additive digital production technologies. Critically, community based digital fabrication workshops, or makespaces, are anticipated to be the hothouse for this new era of localised production and as such are key to future sustainable design and manufacturing practices. In parallel, the concept of the circular economy (CE) conceptualises the move from a linear economy of take-make-waste to a closed loop system, through repair, remanufacturing, refurbishment and recycling which maintains the value of materials and resources. Despite the clear interplay between RdM and CE, there is limited research exploring this relationship. In light of these interconnected developments, the aim of this paper is to explore the role of makespaces in contributing to a circular economy through RdM activities. This is achieved through six semi-structured interviews with thought leaders on these topics. The research findings identify barriers and opportunities to both CE and RdM, uncover key overlaps between CE and RdM, and identify a range of future research directions that can support the coming together of these areas. The research contributes to a wider conversation on embedding circular practices within makespaces and their role in RdM.

Makespaces: From Redistributed Manufacturing to a Circular Economy

Redistributed manufacturing is an emerging concept which captures the anticipated reshoring and localisation of production from large scale mass manufacturing plants to smaller-scale localised, customisable production units, largely driven by new digital production technologies. Critically, community-based digital fabrication workshops, or makespaces, are anticipated to be one hothouse for this new era of localised production and as such are key to future sustainable design and manufacturing practices. In parallel, the concept of the circular economy conceptualises the move from a linear economy of take-make-waste to a closed loop system, through repair, remanufacturing, and recycling to ultimately extend the value of products and materials. Despite the clear interplay between redistributed manufacturing and circular economy, there is limited research exploring this relationship. In light of these interconnected developments, the aim of this paper is to explore the role of makespaces in contributing to a circular economy through redistributed manufacturing activities. This is achieved through six semi-structured interviews with thought leaders on these topics. The research findings identify barriers and opportunities to both circular economy and redistributed manufacturing, uncover overlaps between circular economy and redistributed manufacturing, and identify a range of future research directions that can support the coming together of these areas. The research contributes to a wider conversation on embedding circular practices within makespaces and their role in redistributed manufacturing.

Globala försörjningsbeslut i en industriell kontext

Purpose – The purpose with this study is to investigate which factors that needs to be considered for sourcing decisions to ensure an optimal long-term decision, and which of these factors that can be quantified in a product costing model. To fulfill this purpose two research questions have been proposed: Which factors needs to be considered for a sourcing decision? Which of these factors that needs to be considered can be quantified in a product costing model? Method – A case study was conducted to fulfill the purpose of this study. The case study produced empirical data through interviews and document studies. The empirical data was interpreted and analyzed on the basis of the theoretical framework, created through literature studies. This process produced the result of this study. Findings – Factors to be considered for a sourcing decision have been identified and categorized in four over-arching categories: unit cost, logistical factors, capability factors and risk factors. These factors have been quantified in a product costing model. A preparatory decision model was created to further integrate some risk factors that could not be quantified. Implications – Both the make or buy decision and the manufacturing location decision have been considered in the product costing model presented in this study. The product costing model visualize and take into account hidden costs, rarely considered in sourcing decisions. This further enables optimal long-term sourcing decisions. Limitations – Risk factors remain difficult to quantify. This makes it difficult to determine the cost of risk factors, and as a result of that, to include them in a product costing model. Companies with similar conditions suites the model since the case study was conducted at only one company. Whether the product costing model is true for business in other contexts remain uncertain.

The Essays in International Trade and Finance

The first chapter provides the first evidence on the gross capital flows reactions to the financial sector reform. I establish four new stylized facts. First, the reform is associated with an average increase of 0.03pp in both gross capital flows. Second, immediately after the reform both flows decrease, in the long term they stabilize at a higher than the pre-liberalization levels. Third, the short term dynamics is governed by debt flows, while the long term dynamics are driven by all of the components. Finally, only a complex reform leads to a positive effect. The results are robust to a wide range of robustness checks. In the second chapter we develop a novel theory to explain the recent phenomenon of reshoring, i.e. firms moving back their previously offshored business activities. We firstly provide the evidence for the importance of the quality behind the reshoring decision and then, building on Antoniades (2015) we develop a dynamic heterogeneous firms model with quality choice and offshoring. In the dynamic setting the location decision entails a tradeoff between payroll and quality-related costs. In equilibrium reshoring arises as some firms initially offshore, exploit the increase in profits due to lower wages and finally return to the domestic country in order to further increase the quality. The third chapter provides the new evidence suggesting that selling through global production networks might lead to export upgrade. I relate the sector-level GVCs participation indicators derived from the international Input-Output Tables to the data on the unit values of exports at the product-exporter level. We find a strong association between the export prices and forward participation, in particular for the developing countries. We document also a less robust negative relationship between the GVCs backward participation and unit values of exports.

A ROS-based software architecture for a versatile collaborative dual-armed autonomous mobile robot for the manufacturing industry

The industrial context is changing rapidly due to advancements in technology fueled by the Internet and Information Technology. The fourth industrial revolution counts integration, flexibility, and optimization as its fundamental pillars, and, in this context, Human-Robot Collaboration has become a crucial factor for manufacturing sustainability in Europe. Collaborative robots are appealing to many companies due to their low installation and running costs and high degree of flexibility, making them ideal for reshoring production facilities with a short return on investment. The ROSSINI European project aims to implement a true Human-Robot Collaboration by designing, developing, and demonstrating a modular and scalable platform for integrating human-centred robotic technologies in industrial production environments. The project focuses on safety concerns related to introducing a cobot in a shared working area and aims to lay the groundwork for a new working paradigm at the industrial level. The need for a software architecture suitable to the robotic platform employed in one of three use cases selected to deploy and test the new technology was the main trigger of this Thesis. The chosen application consists of the automatic loading and unloading of raw-material reels to an automatic packaging machine through an Autonomous Mobile Robot composed of an Autonomous Guided Vehicle, two collaborative manipulators, and an eye-on-hand vision system for performing tasks in a partially unstructured environment. The results obtained during the ROSSINI use case development were later used in the SENECA project, which addresses the need for robot-driven automatic cleaning of pharmaceutical bins in a very specific industrial context. The inherent versatility of mobile collaborative robots is evident from their deployment in the two projects with few hardware and software adjustments. The positive impact of Human-Robot Collaboration on diverse production lines is a motivation for future investments in research on this increasingly popular field by the industry.