b'AUGUST 29 - SEPTEMBER 25, 2022CHINA TRADE 25(CHANGINGcontinuedwithnear-shoringindus- Top Carriers from China to USfrom page 22) tries that arent already well other Southeast Asian coun- entrenched in North America,TEUs VARtriesincludingMalaysia,which suffers from a lack of ThailandandIndonesiaareskilled workers. VOCC H1 2022 H1 2021 %gaininggroundaswell.KarlssoncitesafriendCMA-CGM (CMDU) 991,059 974,801 2Vietnams exports to the USwho is one of the largest pic- MSC-MEDITERRANEAN SHIPPING COMPANY S A - MEDU (MSCU) 755,445 666,716 13for the first half of this yeartureframemanufacturersinCOSCO SHIPPING LINES CO LTD (COSU) 695,339 700,904 -1totaled almost $64 billion, athe world. That person, Karls- EVERGREEN LINE (EGLV) 667,493 660,923 1whopping 33% jump over thesonsaid,decidedthatplexi-similar period last year. glass sourcing would remainMAERSK LINE (MAEU) 617,941 509,763 21Vietnamese factories nowin China, but wanted to sourceOCEAN NETWORK EXPRESS PTE LTD (ONEY) 470,960 556,636 -15produce many of the electron- thewoodenormetalframesORIENT OVERSEAS CONTAINER LINE LTD (OOLU) 399,307 401,412 -1icsandothersupplychainthemselves in Mexico. TheyZIM INTEGRATED SHIPPING SERVICES LTD (ZIMU) 234,379 294,509 -20materialsthatwereformerlycouldnt find the supply chainYANG MING MARINE TRANSPORT CORP (YMLU) 189,625 244,015 -22sourced in China. In Vietnam,for the frames in Mexico andHYUNDAI MERCHANT MARINE (HDMU) 176,884 229,542 -23everything is booming. [Busi- theyre still struggling, ItsOTHERS 840,566 667,399 26nesses]aremovingthereandeasytocomeupwiththeseTotal 6,038,996 5,906,621 2factoriesareopening,saidplansintheboardroom,but Karlsson, who is now based inits very, very difficult to exe-Ho Chi Minh City. Its really acute,becauseofwhatChinanents that are needed for fur- new operations in Vietnam.gold rush. built up.niture. We couldnt find it inParticularlyforindu- that100%downto80%or And, he said, Vietnam isChaooffersasimilarMexico. We couldnt find itstrial-typeproducts,[pre- that 80% down to 60%.investing heavily in its ports,situation,whenheworkedin North or South Carolina,COVID] American companiesHowever, he stressed, that bringing much needed auto- withseveralmajorChineseChao said. We had to dupli- werepurchasingupto95%,doesntmeantheendofa mation to the process, whichfurniture manufacturers whocate the whole process. The100%oftheirgoods,theirChina-dominant supply chain. speeds up cargo handling. wantedtodiversifyopera- solution, he said, was for fur- components,theirsuppliesYoucanneverbringback Karlsson also points outtions to North America. Weniture manufacturers to bandfromChina,saidChao.100%ofyoursupplychain that many of those investinglooked at some of the compo- together and invest in brandTheyre looking now to getfrom China. Its too late. in Vietnamese factories come from Taiwan and China. They want to get lower labor rates and also be able to export to the US and Europe with the lower duties, he said. Add to that the need for redundancy if supply chains aredisrupted,akindof backup location.This is popularly known astheChina+Onestrat-egy. However, some maintain this diversification is moving further afield. I dont think its just China Plus One any-more, said Dunlap. I think its Asia Plus One. However,hesquickto add: It is not correct to assume thattheyreshuttingdown whatevertheyhaveinAsia. The idea is that theyre bifur-cating or growing capacity in another region, so theyre insu-lated to some degree from the next disruption.Someindustriesaretaking thisonestepfurther,transi-tioning from a unified, often globalsupplychaintoone that is more regionally based. Theautomotiveindustryis leading the way in this.(See sidebar on page 23)However, Karlsson, Chao andothersalsomaintainthat Chinese manufacturing exper-tise shouldnt be dismissed or downplayed.Norshouldits impressive logistics, both sea-side and inland. After all, China has built up a supply chain over more than three decades, with theskilledlabor,engineering, equipment, and logistics to go with it. Themoresophisticated theprocess,theharderitis to simply transfer operations elsewhere.Thehigherthe value, the bigger the stakes, bothintermsofreturnand in terms of investment. The highlysophisticatedthings that dont just require manu-facturing,butrequiresome engineering, require develop-mentarestayinginChina, said Chao. You cannot just move that stuff over.Thatsparticularlytrue'