Production chains that no longer make sense include that of Tesla's electric-powered cars, whose 1,000-pound battery packs were made in Thailand, shipped to Britain for installation, with the partially-assembled cars shipped to the U.S. Now they'll be entirely made in California.
"Globe-spanning supply chains — Brazilian iron ore turned into Chinese steel used to make washing machines shipped to Long Beach, Calif., and then trucked to appliance stores in Chicago — make less sense today than they did a few years ago....The cost of shipping a 40-foot container from Shanghai to the United States has risen to $8,000, compared with $3,000 early in the decade, according to a recent study of transportation costs. Big container ships, the pack mules of the 21st-century economy, have shaved their top speed by nearly 20 percent to save on fuel costs, substantially slowing shipping times." --The New York Times
Other signs of the "neighborhood effect":
- Ikea opened a factory in the U.S. and more furniture is being made in America
- Electronics companies who moved to China from Mexico are moving back
- Chinese steel exports to the U.S. are falling while U.S. production rises
- Avocadoes in Chicago in January and bananas all year round will make less and less sense