The reasons are many and I won’t try to admit that I have all of the answers but I have come across a few interesting facts. Sure the Yuan is appreciating against other currencies making Chinese products more expensive abroad but I believe there is more to it than that. As the world becomes more competitive, factors other than pure manufacturing costs become more important. Shipping costs are a key reason given by Chinese Manufacturers as to why they locate outside of China. Shorter Lead times and wanting to be closer to their markets and their customers particularly for emerging technologies are other key reasons.
Does this sound like a Lean strategy? It may not be called Lean but it sure has the basics of Lean. Get close to the markets you serve so that you can understand your customers better. Thus that knowledge to develop value streams that can deliver products and services faster, with shorter lead times and with a better value proposition than your competitors.
Lean or just good business sense? Or both?