24.04.2008 | Christian Cahn von Seelen

„Expensive detour abroad“

About a year ago PQ+ reported under „Manufacturing in Germany – A Renaissance“ on the increasing stream of formerly relocated production back to Germany. On the occasion of this year’s Hannover Messe, the big industry trade fair, the topic again gained resonance in Germany’s leading news media.

Many companies admit that they not only underestimated the indirect cost of the relocation, but also the rise in complexity and the challenges of managing an operation in a foreign country – even within the EU. As a consequence for 10 jobs being relocated abroad, meanwhile 3 come back to Germany.

The recent strike of the Dacia workers also demonstrates that labour cost gaps will decrease over time; often already the lack of formal training and the volatility of the workforce make the cost advantage even on shop floor level much smaller than initially assumed. We witnessed ramp up situations, where literally hundreds of additional workers needed to be hired in order to somehow keep the customer commitments.

With labour cost meanwhile only in an upper midrange position among the EU countries (#7), indeed Germany is back on the manufacturing map.

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