Overseas manufacturers losing price advantage

[Omaha Steve]

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2009/04/26/BUHB172VF0.DTL

Tom Abate, Chronicle Staff Writer
Sunday, April 26, 2009

About 18 months ago, a plastics factory in Santa Rosa started getting inquiries from small U.S. companies looking to bring some manufacturing back from China.

The inquiries to Wright Engineered Plastics started amid soaring oil prices. Even after oil went down, the interest continued as raw plastic became more expensive in China while the local firm's material costs dropped, helping offset the advantage of lower overseas labor.

"We're actually winning bids based on quoting prices, which is extraordinary," said Barbara Roberts, chief executive of Wright.

Economist Ross DeVol with the Milken Institute in Santa Monica said such small wins can help teach California how to slow or reverse the trends that have cost the state more than 500,000 manufacturing jobs since 2001.

"Instead of a defeatist attitude, we have to think strategically about what we can do," DeVol said.

The answer may be small manufacturers - Wright employs 48 people - doing small batch orders for little companies like CP Lab Safety.

FULL story at link.