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Is this efficiency ?

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observer    587

Just read an article claiming that the constituent parts of a car can cross the channel up to four times, before final assembly.  Is this what they mean by the single market and trade ?  It would seem logical and cheaper, to build any product in one huge assembly plant, with access to local raw materials and ancillary parts production; which would negate transportation costs, both fiscally and environmentally.        :wacko:

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asperity    266

Without reading the article I couldn't possibly comment apart from to say that it seems far fetched.

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observer    587

Not too sure Asp: same thing seems to go on with food supply.  Remember talking to a s/market manager; who told me they sourced their potatoes in Scotland, so I asked what route do they travel to get to Warrington.  Down the M6 to the main depot (I think) nr Birmingham, then back up the M6 to the s/market. If we multiply this by all the different s/market chains, all sourcing from different parts of the country or abroad, all traveling to their main depots, then out again to their shops; and it's easy to see why we have so many HGVs on the roads.  My butcher sells spuds grown locally, direct from the farmer, so one short trip in a van.     :ph34r:

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asperity    266

There's a world of difference between a single commodity (potatoes) and a motor car which has thousands of constituent parts in it's engine alone. I can understand that parts of an engine, each made up of several components, can be assembled in different countries. And that the process of assembling these components can involve the transportation of these components between different countries, which is in itself trade and makes money. The idea that a profit making business hasn't looked at the feasibility of building a factory for each of these components on the same site as the finished car and decided that, no, it's more economical to have the components made in smaller factories and then assembled in the large assembly plant into the finished product, makes perfect sense to me. You don't seem, even in the 21st century, to have grasped a concept that became apparent in the 19th century - economies of scale.

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16 hours ago, observer said:

Just read an article claiming that the constituent parts of a car can cross the channel up to four times, before final assembly.  Is this what they mean by the single market and trade ?  It would seem logical and cheaper, to build any product in one huge assembly plant, with access to local raw materials and ancillary parts production; which would negate transportation costs, both fiscally and environmentally.        :wacko:

No - for the reasons that Asp describes - the assembly plants are just that they assemble products from the specialist manufacturers of parts that can be made anywhere local, national or international. Yes the practice does increase transport costs but these are negated by the savings in mass producing the parts at least that's why the assemblers do it.

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observer    587

Sorry folks but that argument appears totally counter intuitive, logic suggests total manufacture and assembly at one point would be more efficient, and require less need for road miles. The only factor that does make sense in terms of costs, is labour.  It is clearly cheaper to source labour from poorer countries, either by moving factories abroad, or by allowing the labour to move to the factories. But as automation increases, less labour will be required.       :ph34r:

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Davy51    232

In terms of retail,regionalisation help firms to cope with increasing road traffic volumes & the possibility of vehicles being stuck away from base due to driver's hours regulations. With regional depots ,a vehicle may have 2,3 or even 4 drivers using it during a 24 hour period to deliver locally & on time ,thus meaning there is less time lost on vehicles being parked up away from base for 12 or 13 hours &  less money needed for more more vehicles on contract to cover that down time.

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asperity    266
2 hours ago, observer said:

Sorry folks but that argument appears totally counter intuitive, logic suggests total manufacture and assembly at one point would be more efficient, and require less need for road miles. The only factor that does make sense in terms of costs, is labour.  It is clearly cheaper to source labour from poorer countries, either by moving factories abroad, or by allowing the labour to move to the factories. But as automation increases, less labour will be required.       :ph34r:

You are assuming that the component manufacturers are making the components for one car maker, when in fact they are probably making them for several, in several different and widespread countries. Logic suggests (to use your term) that manufacturers look at the whole process and choose the most efficient way of producing the end product. I think you are probably using the same thinking that led to the demise of British car making and shipbuilding.

And talking about shipbuilding, the Managing Director of Everards (a long standing British shipping company now owned by James Fisher, another long standing British shipowner) William Everard told me that when they were having 4 ships built in China 15 years ago, and needed British Standard electrical fittings they had to ship them out from the UK as they were not available in China. And of course you've guessed it, the electrical fittings were all made in China. It's a small world and shrinking.

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observer    587

I wouldn't dispute your point about smaller components, which could have much wider uses in any case.  The demise of British ship building and car making, as well as a majority of our manufacturing base, was simply a move to cheaper labour markets, allowing ships built in China to be "cheaper". This was further compounded by a Government reliance on the finance and service sector as the basis of our economy. However, there is light at the end of the tunnel, as automation (incl robotics) displaces humans altogether, making manufacturing in the UK even cheaper than cheap foreign labour.       :ph34r:

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Confused52    10

I think Asp is making a important point that the overhead contribution, including R&D, is determined by volume and not just labour costs. The point you (Obs) make is valid for direct labour but not indirect labour. Automation in manufacture makes the direct costs go down but indirect costs are unaffected. That is the reason that we are now losing skilled jobs to low cost countries. The Internet allows a lot of skilled work to be done anywhere. Another important issue is Market knowledge and regulation which tends to be market specific and is not as amenable to doing at common point. There comes a point where the country specific costs are so large that it is not worth trading there. That is why big global markets, such as Automotive, work to UN sponsored standards and even the EU and US have to tag along. These things taken together drive globalisation and organisations need to work at multiple scales which only the best and biggest can achieve in both scope and scale.

 

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asperity    266
4 hours ago, observer said:

The demise of British ship building and car making, as well as a majority of our manufacturing base, was simply a move to cheaper labour markets, allowing ships built in China to be "cheaper".       :ph34r:

A too simplistic explanation Obs. Even you have to admit that the cars produced by the British car industry in the 60s, 70s and 80s were far below the standard set by Japanese manufacturers, and the same holds for shipbuilding. British shipbuilders were left behind on price, build quality, innovation and delivery times by the Japanese, Korean and even Eastern European yards. In the 40s and 50s British shipbuilders were the best in the world but the rest of the world soon caught up and overtook us. You can't stand still and live off your past reputation in the modern world.

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asperity    266
7 hours ago, observer said:

A matter of opinion Asp, I never had a Japanese car.  :D

So you're pontificating on things you have no experience of. Clever.

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Davy51    232

A major killer of our industries were the bed fellows of the man that many people would love to be in power in Britain. El Jezza.

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I remember well my two years working for the Lucas Switchgear Divison in Burnley where we manufacture guess what - that's right switches and lights for British Leyland Cars - sadly it's no longer in existence but markets change and you have to move with the times or die. Another example was a tour of British Leyland Trucks who went through all sorts of changes but very modern and you could order a truck Just in Time - they would call in a variety of components once the order had been placed and it would be assembled in a day and any faults etc. could be pin pointed to the exact place on the production line via their application of 6 sigma and tracking. That place had so much knowledge and experience but even after it number of morphs since Thatcher it was having to run to keep still. Fascinating place and they shared their knowledge and information with the likes of me :) on their free training courses. Companies will do what they have to survive.

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