Manufacturing

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U.S.
A New Landscape for

Manufacturing


















Advanced technology is creating a manufacturing renaissance,
and bringing products and jobs Stateside.

















While manufacturers in some countries have
been sleeping, a growing number of U.S. manufacturers
have been taking back production and market share,
and in the process are creating what many experts believe may amount to a new industrial revolution.
Advances in software and production technology,
abundant and relatively inexpensive energy, fast access
to huge amounts of data, and growing global demand all
are driving the new competitiveness of U.S. manufacturing. This confluence of factors and trends
is on the verge of changing everything—from
where, how, and by whom products are
made, to a seismic shift in global trade.
By 2020, according to a 2012 Boston
Consulting Group report, as much
as 30% of America’s
imports from China
could be produced domestically.

Siemens AG, the German engineering and electronics
conglomerate, is playing a twofold role in supporting the
U.S. manufacturing sector. While the company supplies
modern automation technology and industrial software
to manufacturers worldwide, it’s also a manufacturer
itself. In the U.S. alone, Siemens operates over 130
manufacturing plants, with $1 billion invested each year
in R&D. Recently, Siemens signed a 15-year
global supplier partnership with BMW to
deliver its TIA Portal software system
and Simatic automation products
and solutions.
If that sounds high-tech, it is.
“Technology is the core driver
for manufacturing, manufacturing research, and the manufacturing renaissance,”
says Helmuth Ludwig,
CEO of Siemens
Industry Sector,










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MOTOROLA and the Stylized M Logo are trademarks of Motorola Trademark Holdings, LLC.

Assembled in the USA.

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Siemens
produces energyefficient gas turbines
in Charlotte; and
Motorola’s Fort Worth
factory assembles phones
for the U.S.
market.

North America. Siemens
PLM Software is used in
the automotive and aerospace
industries, even helping NASA create a
simulated, 3D digital model of the Mars rover Curiosity.
Software and automation may be driving innovation in U.S.
manufacturing, but it is American consumers who are driving
companies to bring their operations Stateside. That’s because
today’s consumers want not only customized products that
express their personalities—everything from sneakers to automobiles—they want them as soon as they’re conceived.
In response, more companies are compressing design,
engineering, and production times by locating those functions
within easy access of one another. Where in the past designers
and engineers had to hop on a plane to China in order to solve
a problem or fine-tune a product, now they hop in a car. What’s
more, closing the distance among processes drastically cuts
delivery time to the North American market.

The Rise of Regional Manufacturing

S3

Outlook
Another reason for the return of manufacturing to U.S. soil is
the presence of centers of technological innovation and knowledge. The Dallas-Fort Worth area, for example, is known for its
strong local skill set around telecom technology. And as more
companies relocate design, manufacturing, and delivery to
the U.S., the more gravitational pull these centers will exert on
manufacturers as well as suppliers.
The outlook for U.S. manufacturing going forward is strong.
With a still-fragile global economy, growth in Asia has
slowed. Meanwhile, energy costs and interest rates
here remain relatively low; and U.S. companies have
estimated cash reserves of $1.6 trillion on their
balance sheets.
As a result, international companies are putting
their money on the integration of innovative product
design and production manufacturing in America.
So is President Obama, who last year proposed adding
$1 billion to his fiscal 2013 budget in order to create a network
of manufacturing innovation institutes throughout the country.
But this mainstay sector of the U.S. economy appears to
be reinventing itself faster than any government—domestic or
foreign—initiative. Industrial robots are working side by side
with their human counterparts. 3D printers are replicating
everything from high-tech sneakers to human tissue. And machines are making other machines.
The future of U.S. manufacturing is no longer futuristic.
It is now. ●

www.fortune.com/adsections

Courtesy of Siemens

This August, Motorola will begin shipping its new Moto X
smartphone, a product consumers can design by choosing from
2,000 configurations. It is reportedly the first smartphone
wholly designed, engineered, manufactured, and assembled in the U.S.
The move from manufacturing facilities overseas
to Fort Worth was a radical departure from the
telecommunications company’s standard manufacturing process.
“For us, the big differentiator was that we wanted to
be close to our consumers,” says Mark Randall, senior vice
president of supply chain and operations. “Obviously, order fulfillment—the time between customers going on the website, designing their own Moto X, and delivery—is a critical factor in creating
customer delight. Doing that overseas, where typically the wait
time is 10 days to two weeks, just didn’t make any sense.”
Randall calls the trend “regional manufacturing”—producing products in the markets in which they’re going to be
sold—and believes it is key to meeting consumer demand for
customized products. It may also be critical to creating new
manufacturing jobs.

The company’s 480,000-square-foot, state-of-the-art facility
in Fort Worth (actually a former Nokia plant) will provide
2,200 new jobs that, less than a decade ago, would have been
lost to competitors overseas.
Also bucking the longstanding trend among consumer electronics manufacturers is Google, which began producing its
Nexus Q home entertainment device in Silicon Valley last year,
rather than in China. Rising labor costs in that country were
said to be part of the decision, but so was speed and direct access to production for Google’s designers and engineers.
Meanwhile, modernized facilities are demanding and creating a new breed of worker. “The truth is that the manufacturing facilities of tomorrow are not the ones of yesterday,” notes
Siemens’ Ludwig, “and the manufacturing jobs of the future
are not the manufacturing jobs of yesterday.”
To meet the challenge of creating a workforce for the
near future, U.S. companies are investing in training employees in the high-level skills needed as technology continues
to alter the manufacture of even the most traditional of
American products. Deere & Company, based in Moline, Ill.,
has aligned itself with two local technical colleges and is
educating employees in preparation for a new generation of
tractors and other agricultural equipment integrated with
advanced technologies.

© Siemens AG, 2013. All Rights Reserved.

Turning virtual into real
and skeptics into believers.
Siemens answers are helping leading companies explore new places in new ways.

The engineers at SpaceX knew that successfully
launching a rocket was contingent on millions
of things going right. Just a single error could
impact the entire mission to the International
Space Station. To help solve this challenge,
they turned to Siemens industry software. This
played a critical role in enabling the SpaceX

Siemens industry
software helps
innovative companies
increase productivity,
improve accuracy, and
significantly reduce costs.

team to design and test products virtually before
constructing them physically — optimizing the
chances of a successful launch.
Today, Siemens is helping business leaders
across the U.S. transform the way goods are
manufactured. In industries from automotive to
pharmaceutical, companies look to Siemens for
new ways to do more with less, to raise quality
while lowering costs, and to help factories and
plants be a bit gentler on our environment.
And it’s working — a new era in manufacturing
is beginning to take hold across the country.
Somewhere in America, the people of Siemens
are creating answers that will last for years
to come.

siemens.com/answers

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