Over & Out: It Seems the Transfer of Factories From Germany to the US Is Canceled

NEW – October 4, 2022

In the last six months, I confess, even I was sure that everything that was happening in Europe would force European industry to move to the United States.

It seems that this is what the Americans started all this for, but something went wrong.

The calculation was simple: in Europe, it’s necessary to create an energy crisis so that any production becomes unprofitable. To create such a crisis, Europe must be cut off from its main energy supplier, Russia.

For this purpose, at first soft methods were used – sanctions. Moreover, the reasons for sanctions at the first stage were weak: either someone is allegedly poisoned, then referendums are allegedly illegal, or something else.

Seeing that this does not help and the Nord Streams continue to function and build, the United States has moved to a more radical measure – unleashing war. Let’s not go on now for the hundredth time about how they trained a shepherd dog right under our door, we simply state that this measure also began to look like a failure.

In Europe, right-wing forces, for whom someone’s instructions from across the ocean are unimportant, have become more active. Yes, the right-wingers are not yet in power in Germany (Scholz, for example, is a Social Democrat, that is, a leftist), but in general it was noticeable that Germany was already ready to give up in a couple of months.

That is why the Americans have moved from sanctions to the physical destruction of the gas infrastructure. And something tells me they haven’t finished yet.

It would seem that German factories are now closing and they need to move to continue working. But the trouble is, they don’t really need to move to the US either.

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1. In the United States itself, an energy crisis also broke out – and this is the main failure

Somehow they overdid it. The prices for fuel and electricity there have become, of course, not as high as in Europe, but still very high.

It will be a revelation for many, but the United States has not even built its own factories for quite some time. It is unprofitable inside the United States. It is much cheaper to bring goods from China, Vietnam or Japan.

What will change after the factories move from Germany? Nothing at all. It will also be unprofitable. Especially considering that:

2. Huge delivery leverage

After all, the industry is based not only on energy. Industry needs more:

A) Physical resources (metals, for example)

B) Sales markets

Yes, the United States can provide part of the resources and some market for European factories. But still, a huge amount of resources will have to be transported across the ocean. And then take the finished product back to the same Europe (after all, 500 million people, they also need to consume something), Africa, Asia, etc.

In short, it turns out to be a double and completely unnecessary hook. To make such a detour, the profitability of factories in the US should be just sweet. But it is not at all, neither sweet, nor sour, nor frankly bitter. Zero. More precisely, minus.

3. Where to get workers?

Yes, they will move some engineers. But who will work in all these factories? Migrants from Mexico? Seriously?

Mercedes and BMW factories, for example, require extra-class welders (I know, because my uncle worked as a welder at the BMW plant there). Where in America to get hundreds of thousands (millions?) competent welders, electricians, CNC machine operators, etc.?

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Recruit from the black neighbourhoods of New York?

Well, let’s even say there are a million highly qualified workers. But the average salary in the US is much higher than in Europe. About 2 times, probably.

That is, this salary will be included in the cost of production and it will rise in price even more.

Result

Because of expensive energy, expensive labour, and a large delivery arm, it is absolutely unprofitable to move European industry to the United States.

Yes, of course, something will be moved, but it will not become a mass phenomenon. In addition, moving by itself is also a very expensive thing, especially across the ocean.

That is why German factories, although they are closing, are in no hurry to leave somewhere.

Hint

A hint for our European (non-) comrades. Do you know where there is very cheap energy, a lot of skilled labour, a short delivery arm and a lot of any resources from hydrogen to uranium?

In Russia.

Bring your factories here. More precisely, they will no longer be yours. Actually not. You can keep your share in the authorised capital. Well, for the first time you can definitely. Then-sorry. There’s a price to pay for losing the Cold War, isn’t that what you told us in the 1990s?

Don’t like this scenario? Not a problem. Close up completely and head to the level of Gabon. We will help you with grain and firewood, but please note that there will be no discounts.


Explain on the fingers

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