The world´s factory

The world´s factory

They seem to be everywhere; on the mobile phone, the shirt and even on the toothbrush. The labels proclaiming “Made in China” is of course what I’m referring to. In fact, China accounts for about a quarter of the world´s manufacturing output in terms of value. In some industries, the country is predominant and manufactures for example 70 percent of the world’s mobile phones and 60 percent of its shoes. The fact that China often is called the factory of the world is thus not surprising.

China has quickly emerged as the dominant country of manufacturing. In 1990, the country accounted for less than three percent of the world´s production and has now, as earlier mentioned, about 25 percent. The reasons for this startling growth are many, and it is difficult to pinpoint the most important one. However, it is obvious that the country’s low labor costs, favorable tax laws, well-developed business ecosystem and the permissive environmental regulations have contributed to its success.

During my time here in China, I have had the opportunity to experience the manufacturing industry both through our own factories and through subcontractors’ factories. I have seen big differences in terms of working environment and capability during my visits. For example, I have visited run-down factories with really simple machineries, but also very modern factories with automated production lines. Among the more modern examples is GKN’s plant in Taicang. This factory was started last year and is currently being outfitted with new equipment for the mass production of various components within the Land Systems segment. The factory is of high standard and new production lines can be designed with great freedom, which bodes for good efficiency.

If China will maintain its position as the world’s predominant manufacturer I leave unsaid, but because of the ever-growing pool of experience and the strong desire to constantly achieve new successes, I am not surprised if I´ll see those “Made in China” labels anywhere and everywhere also in the future.


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