Is the "China Shock" Coming—or Just How Stupid Is Being Cheap?

Dear Reader

Recently, the president or director—the titles are interchangeable—of a Swiss trade association stated on a radio program that locomotives used to be built in Switzerland, but that this is no longer possible today. For this reason, he claimed, Switzerland has transformed itself from a manufacturing hub into a service hub. How wrong you are, Mr. President or Mr. Director! The company Stadler proves that high-tech trains—including locomotives—can indeed be built in Switzerland. Then a Lebanese man comes to Switzerland and shows how watches can be successfully produced here, even in the low-cost segment. The leading economists had long since reserved this capability exclusively for Asia as well. We are still capable of producing consumer goods—provided that a large portion of the profits isn’t siphoned off by financial jugglers and board members, but rather invested in research, development, and education.

The pursuit of short-term profits, as well as a general inability to weather difficult times, are highly detrimental to our manufacturing facilities.

We in the West have generally become complacent and are content to merely shuffle around goods that often exist only virtually. The model-making industry and retail sector rely too heavily on sourcing products at Chinese toy trade shows. The goods are then branded with their own label and sold to model aircraft enthusiasts via the web or in stores. The question is whether a business model without in-house development or production will succeed. Ordering directly from Asia via the Internet is already causing problems for our specialty retailers, and the fact that the same product is being marketed under different names could soon lead to market saturation. Prices are coming under even greater pressure, while at the same time Chinese manufacturers also want to increase their profits.

We need to refocus on our potential and increase our own development and production. Small businesses here at home and in neighboring countries are showing, with their quality products, how it’s done. Let’s forget the slogan “Stinginess is Cool.” It didn’t originate in Switzerland anyway. Quality doesn’t necessarily have to be more expensive—buying cheap junk three times ends up costing just as much. And finally: Don’t trust all those “experts” who claim that successful manufacturing isn’t possible in Switzerland. Most of them have never produced anything themselves. Let’s not forget that even a Swiss airline could have been successful if it hadn’t been thwarted by so-called experts, managers, and consultants.

Sincerely,
Emil Ch. Giezendanner