The Brexit Effect on Shipping from China to the UK

The auto industry is greatly dependant on the new globalised economy. As parts are sourced from all over the world, shipping and logisitcs has become an important part of keeping a smooth and steady supply chain. This is a look at how the upcoming Brexit may affect that.

Britain’s decision to leave the European Union has led to uncertainties affecting all forms of business ties to member states and nations that have business associations with Britain. It is yet to be seen how significant the impact will be on the shipping industry. Although EU officials have warned the UK not to make trade agreements outside the EU till after the break likely to occur by March 2019, it remains to be seen that the UK is striving to land huge trade deals with the World superpowers judging fromthe international tours carried by Theresa May’s government.

China, the world’s greatest economy after the US, is one country that the UK will want to bring to the table. While the UK was still part of the EU, China had invested approximately 14 billion pounds on trade in the UK and employed over 20,000 people in 2016 in Britain. Some of the trade deals may have been realized due to the UK enjoying apartnership with the EU hence access to the European markets. In the Shipping industry, the impact will greatly depend on the type of market whether it will be the European market and in this case the Asian market.

Trade Outside the EU

A hard Brexit forces the UK to lose the EU’s single market and in turn end free movement of EU citizens and goods through the UK borders. Although the UK abandons the EU market, it can be a blessing in disguise as they will have the opportunity to negotiate their trade deals with other markets like the Asian market. This can lead to astrengthening of the UK-China relationship as far as trade is concerned. It could also instead lead to increased business outside the EU and as China and other non-EU partners form the bulk of UK port container traffic volume; it could balance out the loss incurred by ending trade with EU member states.

Another approach is that there could be a likely decrease in the UK/China trade. China is the largest non-EU exporter to the UK and the second largest importer of UK goods after the US. This could all change depending on the new trade agreements with nations that also benefit from low labor costs like India and South American countries.

Container Services to the UK

British importers and exporters are also concerned that Brexit will lead to a decrease in the direct mainline container services calling at the UK ports. However maritime experts have expressed that they are not expecting significant changes to the high proportion of direct container vessels calling at the UK ports.

Although there might be changes in the volume of trade between some countries having trade agreements with the UK, the hope is that new trade deals will offset any decreases experienced hence an unlikely tangible impact on the shipping industry. The UK should take their time in coming up with trade agreements particularly with China as one of World’s greatest economy to have long-lasting partnership. With Brexit, it is inevitable that shipping from China to the UK will be affected, but the impact will muchbe determined by the future trade agreements between the two nations.

UAW | Tuesday 10 October 2017 - 01:47 am | | Default
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The Wild World of Auto Shipping

From Domestic Production to International Consumption

This is a reflection of one of our retired autoworkers and longstanding members. Touched upon in this opinion piece is the history of American automotive manufacturing and the rise of the affordable import. All opinions and views expressed in this piece are solely those of the author, who wishes to remain anonymous. 

UAW1111

The Raging U.S Auto Industry

When I was a teenager there were only three options we had upon graduation. The first option was to sign up for the military. The army was hungry for young muscle and they offered a fair deal in terms of pay, adventure and security upon returning home. The second option was to go to university and pursue a degree in higher education. College degrees weren't deemed as necessary back then so this was something mostly academics, scientists and medical professionals pursued, and even they could often get jobs without official university certificates. The third option was to get a job at your local manufacturing plant. 

Back in my day manufacturing jobs were completely different than they are today. Whereas today shipping from China to the USA is so cheap and so common it has pretty much eliminated this career path, when I was young it was actually considered the best choice by millions of young working adults who didn't want to get shot at in the military or waste years at a liberal institution learning endless theories. 

This was a great time to be alive, America was booming, we were manufacturing goods for export all of the world and companies paid their workers solid wages for their honest work. Even though I've been long retired I still look back at this time period quite fondly. 

New Competition from Asia

As with most things in life though, the glory days of good-paying U.S manufacturing careers was not to last. Years after WWII and with financial assistance from the World Bank Japan began to slowly climb its way back into the world stage as a global manufacturing power. 

The United States was all to glad to aid Japan in their 1970s and 1980s miracle development as we were still preoccupied with the former Soviet Union and the instability its collapse created. 

Before WWII Japan was an economic powerhouse. It was their engineering prowness and massive manufacturing capabilities that allowed them to at one point control almost all of east Asia, from the northern reaches of China all the way down the the Marshall Islands, only a hop and skip away from our beloved terrirotry Hawaii. 

So once they Japanese began recovering from the war they looked to emulate the same industries that helpe make the United States so prosperous and helped create the massive middle class which I and many of my UAW brethern be able to live the luxurious life we enjoyed up through retirement. 

Unfortunately instead of increasing quality and investing more in new technology to beat the Japanese in the automotive industry, most U.S auto manufacturers turned to cheap marketing and "cost saving" practices of cutting labor benefits. This began a long slide into decline for the U.S automotive industry. 

Corporate Mismanagement

Entre the 2000's and America elects its first black president, Barack Obama. Wall-Street is riding high, but before long faces crisis due to irresponsible lending practices. This triggers a nationwide recession which hits the automotive industry particularly hard.

Now, I want to make it clear here that the auto industries woes were not 100% the fault of the crisis that started on Wall Street. In fact, the U.S had been losing market share to Japan for a long number of years as Japan pumped out ever more desireable cars in terms of technology and quality. Meanwhile, the U.S auto industry was beyond lazy in their research and development and sold U.S consumers crap for decades.

Eventually consumers woke up to the fact that the best of GM, Daimler and Ford were only half the quality of many Japanese exports, and none the more cheaper either! So faced with decades of declining sales and the crisis which froze consumer spending, U.S auto makers had no choice but to turn to the federal government for a bailout. 

Crisis and Bailouts

This asking for bailouts from the government, besides being one of the most uncapitalist things this great country has ever done was a watershed moment for the manufacturing industry in America.

In terms of benefits and quality of living we had come complete circle from the times when I was a young man and manufacturing was just taking of and promised all sorts of life security to post crisis where companies were billions of dollars in debt to the federal government and producing horrible quality vehicles. 

Looking back on it, all I can say is I am very glad I retired before all of this happened because while auto execs were making horrible decisions for decades, they never ended up paying the price thanks to their million dollar gold parachutes. Instead it was the working man who suffered the most with layoffs, lower pay and ever increasing levels of outsourcing production to places like China and Mexico. 

Electrification & New Horizons

All was not lost in the crisis however. In fact, it seems that after the humiliating experience of being funded by the federal reserve, America's automotive industry took note and has begun to slowly reform itself.

GM and Chrystler paid back their government loans plus interest. Ford paid back their private loans. All three companies launched a large variety of new vehicles featuring all sorts of new technology and better warranties. Competition has not let up as Japan still continues to dominate some segments with their economic offerings from the likes of Honda, Toyota and Nissan, and newcomers to the market Kia and Hyundai from South Korea are also stepping up the heat. 

Still, U.S manufacturers are doing their best to fill market segments imports have always struggled to occupy such as family-sized vehicles including minivans as well as larger country-focused vehnicles like big SUVs and pickup trucks. 

Additionally the growing popularity of electric vehicles, thanks largely to the visionary Ellon Musk and his company Tesla, has pushed U.S companies into developing and releasing more and more hybrid and fully electric vehicles. 

While the day of fully electric vehnicles may still be a ways away, the fact that Ford, GM and Daimler-Chrystler are investing in the technology would seem to indicate they are determined not to be left in the dust like they were in teh 70s and 80s.

Manufacturing may never fully return to the United States and the economic environment in which I thrived may never be the same again, but at least a future exists where young Americans can go to university to obtain technology-focused degrees so that they one day manage the digital companies of the future.

UAW | Friday 14 July 2017 - 07:15 am | | Default
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Memorial Wall

Dedication to UAW1111 Members

What defines the United Autoworkers Union is not just the legal doctines and contracts but instead is the brotherly and sisterly bonds created by a share passion for creating quality, American-made products. Below is a memorial for UAW 1111 members who have passed away.

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UAW | Friday 10 April 2015 - 4:29 pm | | Default
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