Glass Manufacturer Moves production to US to Cut Costs

In an age when many companies are moving to China to cut production costs, Chinese company, Fuyao Glass Industry Group has decided to set up a new production facility in the United States. The company is said to be the biggest global exporter of glass for the automotive sector and has major companies like VW and General Motors on its list of clients. Speaking about the move, the company’s owner, Cao Dewang said that he had moved part of his business to Ohio due to the high taxes in China and the expectation that punitive tariffs to the tune of 45 per cent will be imposed on goods made in China by the United States . He also cited higher labor costs as one of the reasons for the move.

Cao Dewang announced back in October that he would be investing USD 600 million in a glass factory in the eastern US state of Ohio. This is an extremely rare case in which jobs are being exported from China to the United States. Generally, companies outsource jobs and production to firms in countries like China citing lower production costs.
Cao Dewang’s decision drew considerable criticism on social media channels. However, in an interview he gave to Beijing News, Ca said that the he would continue to maintain a presence in China. He said that he wanted to set up base in the US as he is doing business in the country. According to him, the manufacturing industry in China had to face taxes that are 35 per cent higher in China than in the United States. Labor costs are also soaring at an unprecedented rate. Currently, the Fuyao group has production facilities in almost a dozen Chinese cities including Beijing and Shanghai. The company also has a factory abroad in Russia, according to its website.