Bringing Manufacturing back to the UK

[Snowwolflair]

These articles were published in January after the partisan US election hype but as a consequence of the winds of change in the US.  They both still contain bias but the basic facts are correct.

Could Apple's next iPhones be made in the USA?
Apple supplier Foxconn reportedly mulling $7 billion investment in U.S. manufacturing

Its a sign that things are beginning to move, or to be more precise the Far East manufacturers are getting uncomfortable about the threat of a trade war.

http://www.digitaltrends.com/mobile/apple-iphone-us-manufacturing/

Making an iPhone in the USA wouldn't bring jobs here

My point earlier on much more automation for a US factory.

http://bgr.com/2017/01/16/iphone-8-us-manufacturing-trump-foxconn/





Remember Rome was not made in a day, but it was made in Italy. 

[DesertHound]

I'm really enjoying the conversation - some good points have been made from differing angles and they all contribute to the debate. A few observations on points made earlier today if I may ...

There is an impression that the work which has been lost in western manufacturing can be brought back and still compete in the western mass markets. I doubt that will be the case, because the lost work will not be done by people. Making our toy trains here will not create mass employment to serve a mass market. Rather, by design, we will find ways of making precision objects with the minimum of human intervention to serve a specialist market with much higher prices. At least I hope I will not have to re-solder the pick-up wires on almost every Dapol Mk3 coach where the variable hand soldered connections have failed.

In my vision of the future the market will have shrunk considerably and be so niche that the question won't be whether UK manufacturing can compete with Chinese manufacturing, but rather could Chinese manufacturing compete with the UK? I say this because model runs might only be 100 or so and it will be akin to a cottage industry. That doesn't imply inferior quality - they will most likely be very high end, both in quality and price. Of course I could be wrong here (and I hope I am) but it's a thought I do hold and I would love nothing more than to be proven wrong. Perhaps it will become very niche AND still be made in China, with companies such as RevolutioN serving the market. I don't think there would be mass employment from any UK manufacturing (I think Graham Farish in Poole had about 30 employees or so in their factory) and I do not see model trains as a mass market when compared to other goods which are produced for the leisure market (certainly not these days anyway).

It wouldn't be a case of just switching off the production line in China on Friday and restarting it in Britain on Monday, there would be all the tooling to re-import, the factory to set up. specialised staff to be recruited and trained, test runs to iron out problems, supply chains... not to mention the issue of the old factory not caring about the quality of the product line if it knew it's contract was coming to the end (this is not a criticism of China by the way, I think this would be the case anywhere if you told them their services are no longer required). And modern models contain a multitude of components so would there still be a need for a fair number of components to be sourced abroad?

As others have mentioned, with Graham Farish now being a Chinese owned company, I see little chance of manufacturing returning to the UK. My thoughts in this discussion are not so much along the lines of "established brands returning production to the UK" but more so that new entrants at some point find the conditions such that they can produce in the UK. It might not be any time soon, but I do wonder.

Sorry to disappoint you but we deal direct with factories on two projects (plus we trust Rapido and talk to a lot of the other small manufacturers dealing with the same or similar factories).

If you read Rapido's recent newsletter they addressed the issue of bringing back manufacturing to N America and they are terrified by the prospect for similar reasons to us - lack of skills at a price the market will pay.

On a wider issue raised by TylerB and DesertHound - I'm not so sceptical about the size of the market, where there has been a significant change is that the manufacturers have covered the obvious go everywhere models eg class 37 or 47 or a black 5.  Those are the sorts of things you knock out by the 1000s. So new models are almost by definition more restricted in appeal and therefore you need to start looking at smaller volumes.  The other issue is that companies are trying to be more efficient in holding less or no stock (ie less cash tied up) but that means models aren't sitting in stock 12 months of the year.

Cheers, Mike

Mike, you probably have the greatest insight here of all of us. Without delving into confidential info. could you kindly bandy around some figures re the size of the market, e.g. size of the UK N market, what is a realistic loco production run, and so on? It would be fascinating to know.

Japan is a bit of a different case, sure there's a demographic problem (fewer children) but it's an incredibly train-orientated country and despite being full of gadgets  I have yet to hear any serious worries about "the future of the hobby". Moreover it's retained a substantial portion of its model manufacturing capability and I think in the longer term it will be easier to bring back production from overseas if necessary (except maybe for MicroAce who have already had their hand burnt once in China).

Interesting point you make Railsquid, and you might be on to something specifically with Japan - it might just be different. That said, is it still a hobby for the young generation (your little one aside) and have newer technologies not muscled out our cherished hobby? My concern (worry) from what I see from twenty-somethings today is a fixation with mobile devices connected to the internet. My personal opinion is that this is leading to shorter attention spans, a "have it in an instant" culture and generally less patience - these are "qualities" which are diametrically opposed to our hobby. Are these not prevalent in Japan too? I find it baffling (amusing) to see people's responses when I tell them I cannot get the internet on my phone unless I can connect to a wifi account, or that I don't (generally) use or care for facebook or said country equivalent.

All my thoughts guys and proffered with the greatest of respect.

Kindest

Daniel

[railsquid]

Japan is a bit of a different case, sure there's a demographic problem (fewer children) but it's an incredibly train-orientated country and despite being full of gadgets  I have yet to hear any serious worries about "the future of the hobby". Moreover it's retained a substantial portion of its model manufacturing capability and I think in the longer term it will be easier to bring back production from overseas if necessary (except maybe for MicroAce who have already had their hand burnt once in China).

Interesting point you make Railsquid, and you might be on to something specifically with Japan - it might just be different. That said, is it still a hobby for the young generation (your little one aside) and have newer technologies not muscled out our cherished hobby? My concern (worry) from what I see from twenty-somethings today is a fixation with mobile devices connected to the internet. My personal opinion is that this is leading to shorter attention spans, a "have it in an instant" culture and generally less patience - these are "qualities" which are diametrically opposed to our hobby. Are these not prevalent in Japan too?

Good question, if you walk past the local playground on the way to the nearest level crossing you'd have a good chance of seeing a huddle of teenagers each staring at their own smartphone, but also seeing others at the level crossing spending hours waiting for unusual formations to pass so they can photograph them. But I don't have any empirical evidence one way or the other. As far as instant gratification goes, that's what Kato Unitrack is for - I know it's anathema to some people but it's a damn good way of making the hobby accessible. It also helps that it's comparatively cheap, and widely available. Which all helped to get me hooked, 50 quid or so got me a controller, some track and a cheap basic EMU and it all just worked. And like I said, Japan is very train-orientated so there's much wider exposure to the whole idea of trains than in many other countries, it's also not seen as a weird to have an interest in them.

Something else which probably plays a role is "Plarail", which is kind of like a cross between Brio and Lego trains, very robust, very cheap and incredibly popular - get used to that and it's a logical step to Unitrack etc.:



(Having played with that for a few weeks, the Squidlet, when shown some sections of Tomix Finetrack, indicated very clearly that I should join them together for him).

Erm, and kind of back on topic, that blue Plarail stuff is made in Thailand, for whatever reason.

[Railwaygun]

Remember Rome was not made in a day, but it was made in Italy.

Like Fiats then - built by robots, driven by Italians!

[Snowwolflair]

Remember Rome was not made in a day, but it was made in Italy.

Like Fiats then - built by robots, driven by Italians!

You have grasped the idea 

[JayM481]

So I guess that makes me the qualified person

I'd say the qualified person here is Mike from Revolution Trains, who is actually in the business of making model trains.

As I said I suspect Rapido Trains (I need to correct my earlier post) will find that given the new protectionism in America they will eventually conclude bringing their manufacturing back to the US is the thing to do.  Not now but soon if it keeps going the way it is.  After all he is making enough volume to justify it.

I think Rapido might choose Canada rather than the US for manufacturing, otherwise as a Canadian based company they would still risk dealing at arm's length with the "off-shore" manufacturer. I am not sure that they ever manufactured in the US.

Good point but they are inside NAFTA so i'm not sure how that would affect them.

Mexico is in NAFTA, and the agreement is in the current US administration's sights for "renegotiation."

[Rabs]

One thing that this thread hasn't touched on, that I think is important, is the likely changes in manufacturing technologies.
At present the design of our models has some distinguishing features that, to a large extent, define how they are made and hence where they are made:

Detail: The only manufacturing process that can accurately and repeatably produce the fine details that we want in our models, at a price that is in any way affordable, is injection moulding.  However, injection moulding is a process that is much better suited to production volumes of >1,000 (and really comes into its own in volumes >100,000) than short runs of a few hundred.  It's a process where setup times are significant but process times are quick.  A modern IM machine can run off a few hundred impressions of a small part like an N gauge shell in an hour or two.  However, it takes many times as long to set it up for that run.  This, along with the high cost of making the moulds, makes it a pretty uneconomical for what we want but we don't really have an alternative at present.  We are currently using a sledgehammer technology to crack a small nut.

Manual Assembly: Our models require a lot of manual assembly, which is expensive wherever you do it (although it's obviously substantially less expensive in the far east).

It doesn't need to be this way, though.  Over the next few years we will probably see significant changes to how small volume products are manufactured because of technologies like 3d printing and more flexible automation.  These will reduce our dependence on injection moulding and manual assembly and it seems pretty clear to me that this will help to level the playing field between manufacturing in the far east and the rest of the world, at least for low volume products.

That said, the question of whether the effect of this will be in 2, 5 or 10 years hard to guess and will probably make or break quite a few production managers' careers in the next few years!

[red_death]

Mike, you probably have the greatest insight here of all of us. Without delving into confidential info. could you kindly bandy around some figures re the size of the market, e.g. size of the UK N market, what is a realistic loco production run, and so on? It would be fascinating to know.

Hi Daniel

No problem.  For a powered model you are talking in the region of a minimum of 1000 models (potentially split across multiple liveries), for unpowered models 2000 upwards.  The reality is you could produce fewer models but the cost of tooling would likely make it prohibitively expensive. 

Size of market - small! The NGS has 5500-6000 members - what I don't know is how many N gauge modellers aren't members.  I suspect it is a reasonable quantity to the point that you could say at least double that figure model in N gauge in the UK (primarily).  I'm sure I've heard 15000-20000 N gauge modellers before.

Cheers, Mike

[DesertHound]

Thanks Mike

Useful information. So I'm interpreting that to mean 1000 models is a "comercially driven figure" in that it's producing enough to keep the models affordable, but not producing too many so as to leave them on the shelves unsold. That sounds like a reasonable number and I'd forgotten about multiple liveries meaning that you can get the cost efficiencies of a 1000 production run, but limit supply onto the market, of say, 200, if you had five liveries.

Crowdfunding, as per RevolutioN might be the way forward then in terms of de-risking.

As for the NGS - as soon as you said 5500-6000 members, I immediately thought total n gaugers must be 4 times that ... So my guess is around the 20,000 mark. My rational is that if it's only 10,000 then every second modeller is a member of NGS. I'm more inclined to say 1 in 4, but who really knows?

Thanks again for the info.

Dan

[Karhedron]

Tooling is an interesting question. I remember in the past Dapol have talked about the difference between hard and soft metal toolings for injection molding. Hard metal toolings are considerably more expensive but will last a long time. Soft metal toolings are cheaper but wear out faster.

As far as I understand it, most manufacturers currently use hard metal toolings with a plan to amortise the cost over potentially more than one run. Perhaps we are now reaching the point where more niche products might only be viable in soft metal toolings? So a single production run is done and once it is complete, the tooling is discarded.

I don't know the figures so I have no idea if it would be viable. But I have heard toolings account for something like 40% of the production costs so perhaps there are savings to be made there for niche items?

[Snowwolflair]

Good soft tooling will give you at least 1000 cycles before it looses its sharpness, but if you are doing cheap kits and don't mind a bit of flash and cleaning up the moldings they can go a lot further.

Soft tooling is also easier to make using automated systems straight from CAD so you can remaster a soft tool relatively easily.   

[acko22]

With the tooling is it not a potential false economy when it comes to Hard Vs Soft tooling?

I appreciate that the cost of the tooling's I one of the greatest costs in the production process, but if a manufacturer went with soft tooling's, while cheaper there may be a need for multiple sets to ensure that the quality is kept at the standard the market expects these days?
But also although there are niche models out there, and we all have the niche models in out wants list would the danger not also be that while a manufacturer may do a model thinking it would be a niche single run it may prove to be more popular when it come available to purchase off the shelf.
If this is the case then is there not a danger of it biting any manufacturer in the back side as any savings that could be made from soft tooling would be immediately lost in having to produce a second set?

[Karhedron]

If this is the case then is there not a danger of it biting any manufacturer in the back side as any savings that could be made from soft tooling would be immediately lost in having to produce a second set?

Yes, that is always a possibility. I am not saying that soft-tooling is the right answer. Only that it is a potential solution for small volume models which might make a marginal prototype viable.

[Snowwolflair]

Good point, but there is a vast cost difference between soft and hard tooling.

[acko22]

excuse me for my lack of knowledge what is the kind of difference between the costs of hard Vs soft tooling?