RPM Sept-Oct 2019

23 And while it is true that we have the ability to measure a vehicle’s domesticity, thanks to the American Automotive Labeling Act of 1994 and The KogodMade In America Auto Index created in 2013, the truth is: there isn’t a single mass production vehicle from any major automaker that is 100%Made In America—with the sole exception of Tesla, who arguably functions more as a market disrupter than contributor. It’s Complicated It’s true, that even with high operating costs, regulatory red tape, and overseas competition, the United States still produces roughly 18% of all global products and maintains a foothold as the third largest export economy in the world, behind China and the European Union. But when we start to dig a little deeper and look a little closer at that slowly shifting, vintage fabric of American manufacturing—we see that not only is the pattern changing, but also the edges are beginning to fray. Because, like it or not, “buying American” in today’s economy is much more complicated and, more often than not, much more compromised. From government regulation, trade wars, labor shortages and rising overhead to the mainstreaming of next-gen technology and self-driving cars, American manufacturing has perhaps never faced more unique challenges than it does right now. The production of U.S. goods looks worlds different than it did just a few short decades ago and—in a few more—it may be unrecognizable. Yet despite these struggles, the nonprofit professional group Manufacturers Alliance for Productivity and Innovation predicts the “best U.S. manufacturing growth performance in more than a decade,” expecting production to grow 3.9 percent in 2019. As global media company Forbes points out, “In the past thirty years, a time during which lots of ink was spilled about American manufacturing disappearing, absolute output has risen almost nonstop.” So, how is it that a reportedly dying facet of the U.S. economy continues to survive and, in some markets, thrive? How are the country’s manufacturers, both big and small, maintaining the integrity of that Made in America stamp? Inquire Within Part of the misrepresented “doom and gloom,” suggests Forbes, is attributed to the decline of manufacturing employment, “so what a lot of people feel and see in their communities hasn’t felt like growth.” It is perhaps a cruel irony for American manufacturers that as the economy continues to improve and consumer spending increases, the talent shortage worsens. Historically low unemployment, while inarguably an achievement, also means companies have a smaller source pool of potential job-seeking candidates. Candidates may not even possess the specific skill set needed\ thanks to a decline of skilled trades In a special report conducted by Popular Mechanics Magazine, interviewing 26 companies about the state of manufacturing in America, the number one challenge disclosed by respondents was the lack of qualified workers. “Carhartt can’t find pattern makers,” reports the publication. “Stihl said it could take seven months just to find a tool-and-die-maker candidate. Merck’s trouble is control technicians—one of the highest paying hourly jobs it offers.” Despite paying well, these jobs don’t appeal to a younger workforce raised to believe every negative stereotype about manufacturing work. A worrying trend, as the aforementioned Deloitte study indicates that the skills gapmay leave an estimated 2.4 million positions unfilled over the next decade, a shortage which could put $454 billion of manufacturing GDP at risk in 2028 alone. Thankfully, concerted efforts are slowly chipping away at the problem. Both politicians and private companies are funneling more money into struggling technical programs at high schools and community colleges. And the schools themselves are working to repair the damaged reputation of manufacturing and trade jobs, by highlighting the better pay and STEMeducation opportunities, as well as exploring formerly untapped recruitment markets—namely, the female demographic. Additionally, major players like SEMA host countless events to build enthusiasm and brand awareness within the automotive aftermarket, showcasing the talent of industry craftsmen with high profile competitions like Battle of the Builders and the Young Guns program. This is in addition to the work the SEMA Board of Directors does to fight for enthusiasts and professionals by combating overzealous regulation and red tape so these jobs can exist at all. Buddy Up Interestingly, some of the most popular survival tactics to combat economic challenges—corporate consolidations and targeted acquisitions—often reinforce the ill-informed bleak outlook towardAmericanmanufacturing, leaving customers questioning the strength of a company that sells off portions of its business or closes a local plant However, as the auto industry has made startingly clear lately, mergers and strategic partnerships are quickly becoming less about strength and more about endurance. After automakers’ overwhelming talk of “wholesale industrial restructuring” at the Geneva International Motor Show, news outlet Bloomberg stated, “Low industry valuations show investors want more changes with spending at a record, profits falling, and new competitors vying to jump onto the autos bandwagon. Consolidation, while no silver bullet, would help eliminate the duplicate outlays on everything from expensive software ventures to battery technology.” PSA Group CEO, Carlos Tavares, seemed to echo this deduction when in Geneva he stated, “We are entering a period where chaos is going to make competition extremely selective. This perhaps changes the way our companies are operating.” In short, when it’s a matter of staying in the game, sometimes your enemy is your friend. Perhaps nowhere is this more evident than in the $1.1 billion joint venture between rival brands BMWandDaimler. (continued on page 24)