Automation and China

As we develop more sophisticated robots and factories, more and more jobs are being sourced again in the US and Europe.

This means that China, for a long time our number one supplier, will see its 30 year growth diminish drastically in the next few years.

The change is already underway and the likely outcomes of this shift are going to be twofold: there's going to be a massive shift towards copying or improving upon existing IP. That's going to be front and center in courts everywhere.

Secondly, there's going to be a vast amount of small to medium factories in Shenzhen, and the other manufacturing hotspots that are going to go bankrupt.

We already have real world examples of this. One needs only look to last year and all of the hoopla concerning hoverboards and their invention, with Razor, Segway and Swagtron (a Chinese company) going to court for the rights to the hot Christmas gift.

And that's even before Segway joined in the fun.

The fires and the drama that resulted are, in part, the result of a world where most people shop online, and where shipping from one side of the globe to the other is not very expensive anymore.

Quality controls and independent testing be damned, these products are sometimes a real hazard, as we've seen.

What all of this will entail is largely dependent on the Chinese government's foreign policy.

For now, it's wise to know that we live in an era of imminent, disruptive change.

And if that doesn't prompt some thought, you may as well start figuring out what we're gonna do once all human workers are replaced by machines.

According to Elon Musk, there's real value in thinking about the "machine that builds the machine". And you can rest assured that's going to be the underlying theme in manufacturing for the foreseeable future.