Made In China?

There was a really interesting announcement from Heidelberg last week. Basically, it said that a significant portion of manufacturing for Heidelberg postpress systems would be moving to China. The reason given was that manufacturing costs in Germany were making it very difficult for Heidelberg to earn its margin on these finishing systems.

Are you surprised?

The overall commercial print marketplace is still in a state of adjustment. There is still somewhat of a mismatch between available print capacity and demand. So there hasn’t been very strong demand for newer offset finishing systems (with some exceptions). That’s caused a big hit on the major postpress suppliers, almost all of whom are European. As unit sales have fallen, they’ve been stuck with a large, highly-skilled, and highly-paid labor force. This has put many of them in a financial bind, and they have begun to “slim down” their organizations.

So the lower manufacturing costs in China have begun to look quite attractive. While a terrific number of products we buy in everyday life are made there, the presence of both Chinese-made offset presses and bindery systems in the United States have been minimal so far. There are many reasons for this. Chinese firms are really good manufacturers. I have a project with a Chinese-made perfect binder. I have to say that I’ve been impressed with the machine’s quality, and with the manufacturer’s level of support.

But Chinese finishing systems manufacturers are not terrific marketers, and the U.S. finishing market is very sophisticated. The European companies have spent decades building up their U.S. operations and presence, and they are literally household names among the U.S. print community. The steady pressure on the EU companies may force some of them to begin manufacturing parts, or whole systems on the mainland. This would increase the awareness of Chinese manufacturers and open the door to the U.S. market a bit wider for them.

Don has worked in technical support, sales, engineering, and management during a career in both the commercial offset and digital finishing sectors. He is the North American representative for IBIS Bindery Systems, Ltd. of The United Kingdom.
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