relocations are accelerating in Europe and the United States

relocations are accelerating in Europe and the United States
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The search for greater resilience of supply lines: this is the main reason, according to a Capgemini study published this Thursday, why industrial groups are massively relocating companies, both in Europe and in the United States.

In February, Capgemini surveyed 1,300 senior managers of industrial groups with more than a billion dollars in annual turnover, spread across the United States, Germany, Denmark, Spain, Finland, , Great Britain and Italy. , Norway, Netherlands and Sweden. The survey describes “ a real groundswell » reindustrialization in all countries studied and in all sectors.

We were surprised by the scale of the phenomenon » relocation, tells AFP Etienne Grass, executive director of Capgemini Invent, French subsidiary of the consulting firm, one of the authors of the study. “ It’s really considerable “.

Investments equivalent to 8.7% of the turnover of the companies studied

According to the survey, the overall amount of investments planned by companies in 13 industrial sectors in the 11 countries studied to strengthen their production capacity either at home (” reshoring “), or in a neighboring country (” near-shoring “), swelled to $3.4 trillion for the next three years (February 2024-February 2027), after reaching $2.4 trillion over the last three years (January 2021-January 2024). These investments are equivalent to 8.7% of the turnover of the companies concerned.

Beyond the search for greater resilience of supply lines, put forward by 70% of manufacturers in response to shortages of goods linked to the breakdown of manufacturing or transport chains during the health crisis, three other reasons are advances.

The Court of Auditors draws up a mixed assessment of the government’s relocation policy

Geopolitical tensions (Ukraine, Middle East, etc.) are cited by 63% of respondents. 55% of the industrialists questioned highlight their desire to reduce CO2 emissions – including scope 3 greenhouse gas emissions, known as indirect, for 55% of the industrialists questioned. Finally, just under half (49%) of managers explain their motivation by financial incentives and public reindustrialization policies carried out in their countries.

Europe more voluntary than the United States

In the study, French companies show reindustrialization investment projects amounting to some $340 billion between 2023 and 2026. German projects amount to $673 billion, and those in the United States to 1,400 billions of dollars.

Relative to GDP, the French reindustrialization effort (13% of GDP) is almost three times higher than that of the United States (5%). », Adds the executive director of Capgemini Invent. The French government announced in August 2020 a program worth one billion euros dedicated to the relocation of industrial activities in France as part of the post-pandemic recovery plan. One of the main objectives was to bring back products “ essential to our independence “, then clarified the Minister of the Economy Bruno Le Maire.

However, while the Novo Nordisk laboratory is preparing to announce an investment of two billion euros in its factory, the Court of Auditors judged at the end of November 2023 that the aid system put in place in 2020 to boost relocations includes “ high risks of dusting » public money and windfall effects

The German effort (20% of GDP) is four times higher. And this, despite the vast Inflation Reduction Act (IRA) plan announced by the Biden government. This American law grants generous subsidies to certain strategic industrial sectors (electric vehicles, batteries, etc.) but is accused by Europeans of distorting competition.

In France, a “ around twenty » relocation projects for industrial activities linked to defense are supported

A ” around twenty » projects for the relocation of defense industrial activities are supported by the public authorities as part of the “ the war economy » intended to meet the needs of Ukraine and the new geopolitical situation, according to the Elysée.

Like the production by Eurenco of propellant powder for shells, a factory for which Emmanuel Macron laid the first stone last Thursday in , some of the projects aim to bring back to French territory production that had been abandoned in the past.

This is particularly the case for the manufacture of 250 kilo bomb bodies (BA82) by Aresia. If the creation of this new chain in Rouvignies (North) was self-financing, the company benefited from the support of the Ministry of the Armed Forces to accelerate the qualification of these bomb bodies, which it was not billed for, according to him . Another example: the start-up Vistory will set up in a “ 3D printing module production factory “. This initiative is part of an additive manufacturing center created by KNDS France (formerly Nexter) and MBDA, the “ Printing Bourges », to produce certain missile parts more quickly, for example.

(With AFP)

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