Email of the day on David's recovery and industrial automation:
Comment of the Day

July 13 2017

Commentary by Eoin Treacy

Email of the day on David's recovery and industrial automation:

I hope you are well and that David is recovering / progressing well.

?I was just thinking about your theme of cheap local robotic manufacturing and our Brexit.

It another thing to our advantage as we will become less reliant on German and EU manufactured goods. Plus long term, it will effect Germany quite a bit, won't it?

Eoin Treacy's view

Thank you for your well wishes on David’s behalf and this question which may be of interest to subscribers. 

I was in contact with David today and he is recovering following the heart related issues he needed to have ablation for last week. He picked up a secondary infection while in hospital which has put a dampener on his recovery but is home and looking forward to making a full recovery. He is less than impressed by what he calls the "factory farming" nature of the medical system but is otherwise is good spirits. 

I have written in the past about the potential for increasingly automated factories to greatly enhance the efficiency of the global supply chain. The reality is that these types of operations would require access to substantial populations of consumers in order to reach economies of scale that would justify the expense of building them. 

Transportation takes time and costs money while labour costs are rising just about everywhere. The logical answer is to site factories where energy is cheap and close to large populations. China is automating at a rapid pace because it wants to ensure it holds onto the “workshop of the world” moniker. It aims to automate before everyone else so it can continue to export at competitive prices. Unfortunately, it is arguable whether the UK will be a beneficiary of this kind of automation because the market might not be large enough on its own to justify it post Brexit. 

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