Going local and other trends in global supply chains
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Going local and other trends in global supply chains

December 14, 2021 | Chart

The global supply chain disruption associated with the COVID-19 pandemic has resulted in production delays, shortages, and a spike in inflation in many parts of the world. Many global companies are adjusting their global production networks to meet their customers’ demand. Furthermore, a longer run trend of moving production and sourcing closer to customers is continuing, and in some cases accelerating, due to government policies and regulations.

This trend is not entirely new. From 2011 onward, manufacturing sectors in many mature economies increasingly localized sourcing. Foreign content in local manufacturing production declined globally, while in Europe it stagnated. “Going local” is reversing a decades-long trend of global supply chain fragmentation across borders. Looking ahead, policy and initiatives in the US and Europe point to further localization in the future. Global production networks will not disappear, but the era of simply offshoring to cut costs may be waning.

For more information on this and other trends in globalization, please see our new report "The Future of Global Supply Chains: Five Trends.

More on this topic:

Read the report: Winners and Losers if Supply Chains Shift Away From China

Listen to the podcast: CEO Perspectives: Supply Chains: Where's Our Stuff?

Read the report from Conference Board of Canada Designing Supply Chains for a Post-Pandemic Era 

AUTHOR

IlariaMaselli

Former Senior Economist
The Conference Board


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