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Re: OT (or is it?): China set to challenge Boeing and Airbus

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Posted by Anonymous on Friday, March 23, 2007 9:26 PM
 Murphy Siding wrote:

It would seem these same ideas would hold true for China trying to build a competitive commercial airliner, espescially the bad product part.

Apparently the market thinks so:  U.S. exports of high-tech capital goods are rising at record pace.

S. Hadid 

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Posted by beaulieu on Saturday, March 24, 2007 1:03 AM
 1435mm wrote:

 

I don't know what the cost is, but the price is whatever the Chinese government decides.  Suffice it to say that EMD and GE satisfy virtually all of the diesel-electric locomotive market outside of China, Japan, Russia, and Western Europe, and in Western Europe EMD supplies the lion's share of locomotives purchased by railroad companies not in thrall to a national government.  Whatever the price of the Chinese locomotive on the open market, apparently it is not low enough to gain much interest.

<snipped> 

EMD seems to be struggling a bit this year in mainland Europe, even EW&S (Canadian National subsidiary) is taking a batch of Vossloh G2000 locomotives (EMD Class 66 power category) for operation in France and Germany. Bombardier and Siemens are making inroads against EMD in the market for Diesel-Electrics among the Independent Operators. I don't know if the reason is slow deliveries or what. European electric locomotive builders Alstom and Siemens are supplying modern high-powered Electric locomotives to China beginning this year in the same manner as EMD and GE are supplying diesels, a few complete locomotives and then kits. 

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Posted by Anonymous on Saturday, March 24, 2007 3:51 AM

Having some knowledge of the Class 66 vs. the Vossloh G2000 and the Bombardier and Siemens products, I don't know what to attribute this result either, other than commercial reasons.

S. Hadid

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Posted by jockellis on Saturday, March 24, 2007 7:44 AM
G'day, Y'all,
To get in with the Chinese, GE Transportation had to promise to build some of the loco parts in China. And it agreed to start using some Chinese parts on US locomotives.
Where I live, a small manufacturer of racing disc brakes decided he could make more profit by buying his brake caliper forgings/castings (whichever) from China. So he changed and the race car drivers began to notice that their cars wouldn't stop. So they stated using a different supplier. Happily, the manuracturer here is no longer in business. What a wonderful ending to a business success story!

Jock Ellis Cumming, GA US of A Georgia Association of Railroad Passengers

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Posted by doghouse on Saturday, March 24, 2007 6:45 PM

 

O/T:  Mr. smith.  That picture you have at the bottom of your posts; I know that they are from Dr Who.  However, their name(s) elude me.  Little help!?

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Posted by beaulieu on Saturday, March 24, 2007 9:14 PM
Dalek
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Posted by Anonymous on Sunday, March 25, 2007 8:13 AM
 eastside wrote:

Despite all the hysterics, the reality is that China's competitive advantage lies in unskilled labor, and it will be so for several decades. Any enterprise or undertaking in China that strays from exploiting that advantage is likely to fail.

Airplane manufacturing is emphatically not one of those industries--on the contrary it's on the other end of the scale. At most you might see China manufacturing airframes for domestic use by 2020. I predict they'll still be relying on foreign sources for jet engines, avionics, composite materials, and systems integration, that's where the big bucks are and still will be. Look at Japan, which at one time was in the same place as China. Japan may not have the the potential internal market that China might have, but they have the legal infrastructure, access to technology, management skills, and capital that China doesn't have. Yet they don't have a standalone aviation industry. Despite some earlier misguided attempts at government interference and notions of prestige, Japanese companies prefer instead to work with American aircraft manufacturers through alliances. They seem to have found their competitive advantage in high tech machine tools, composites, and assembly.

Don't forget that China has some huge problems. Aside from ecological and resource limitations, by 2030 China will be hitting a severe demographic crisis in that their workforce is going to be aging rapidly (remember they've had a one-child policy in force for several decades).

China does have a lot of unskilled labor, but the heart of their competitive advantage is not so much unskilled labor as it is a lower standard of living.  There is nothing to prevent their labor base from being infused with skills and competence while still retaining their low overhead advantage from their lower standard of living.  They may have a legacy of building only the frivolous products where shoddiness can be tolerated, but I think it is a mistake to believe they will remain at that station. 

Twenty years ago, people recognized that manufacturing was going to be outsourced to China.  U.S. engineers and designers assured themselves that the white-collar aspect of manufacturing would stay in the U.S. while only the hands-on work went overseas to take advantage of low skilled labor.  Wrong assumption.  Engineering and design jobs are flying out of the U.S. and landing in China and India.  Engineers in India are as numerous and competent as U.S. engineers, and they work for $7.00 per hour.  Their work product is only data, so it is not limited to being produced in a particular location.

Today, the industrial design profession (stylists and creative designers) is nervously assuring itself that while China may be capable of performing the hands-on work, and the engineering, they just don't have the thought process needed to design products that are styled to meet the tastes of western consumers.  I would not bet on that.     

China consistently has graduated more engineers than the U.S., Japan and Germany combined every year since 1997, according to figures collected by the National Science Foundation in Washington.

 

http://www.jsonline.com/story/index.aspx?id=196593

 

 

Quote from the article:

"If the U.S. manufacturing base continues to shrink at its present rate and the critical mass is lost, the manufacturing innovation process will shift to other global centers. Once that happens, a decline in U.S. living standards in the future is virtually assured."

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Posted by eastside on Sunday, March 25, 2007 12:19 PM
 Bucyrus wrote:

China does have a lot of unskilled labor, but the heart of their competitive advantage is not so much unskilled labor as it is a lower standard of living.

A low standard of living is an outcome of cheap, unskilled labor, not a separate quality.  When companies go out to the labor market they hire on the basis of skills, not living standards.  When I hire a person I look at his experience and skills, not how well he lives.  Thus his living standard gives him no more or less competitive advantage for the job.
 Bucyrus wrote:

There is nothing to prevent their labor base from being infused with skills and competence while still retaining their low overhead advantage from their lower standard of living.  They may have a legacy of building only the frivolous products where shoddiness can be tolerated, but I think it is a mistake to believe they will remain at that station.

What I'm saying is that the advantages of having lots of cheap labor are way overstated and neglects the disadvantages.  Even now, some of the coastal areas of China have become expensive enough so that manufacturers are going elsewhere such as Vietnam.  I'd maintain that China will continue to grow at a good clip, but perhaps not at all if they don't address the severe problems that I mentioned: ecological, governance (lack of accountability and official corruption), and demographic.  Another huge problem is that their financial system is basically dysfunctional.

 Bucyrus wrote:

China consistently has graduated more engineers than the U.S., Japan and Germany combined every year since 1997, according to figures collected by the National Science Foundation in Washington.

Quote from the article:

"If the U.S. manufacturing base continues to shrink at its present rate and the critical mass is lost, the manufacturing innovation process will shift to other global centers. Once that happens, a decline in U.S. living standards in the future is virtually assured."

Again, I'd cite Japan as the historical example to compare against.  The cause and effect cited in the preceding quote had its origins in the '70s and '80s when it was noticed that Japan graduated more engineers than the U.S.  Remember the critics were moaning that all of U.S. manufacturing was going to Japan and that the U.S. was going to decline because it trained too few engineers?  What happened?  In the period 1993 to 2003 Japan's GNP grew at an annual rate of 1.3% and the U.S. grew at a rate of 3.3%, meaning that in the period the Japanese economy grew 14% and the U.S. economy grew 34%.  Some decline!  My gut feel is that China's economy (with a population 10 times greater than Japan's) will achieve a size of about 3 Japans by 2030.  After that, they'll hit a plateau.
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Posted by wallyworld on Sunday, March 25, 2007 12:47 PM

 eastside wrote:
 Bucyrus wrote:

China does have a lot of unskilled labor, but the heart of their competitive advantage is not so much unskilled labor as it is a lower standard of living.

A low standard of living is an outcome of cheap, unskilled labor, not a separate quality.  When companies go out to the labor market they hire on the basis of skills, not living standards.  When I hire a person I look at his experience and skills, not how well he lives.  Thus his living standard gives him no more or less competitive advantage for the job.
 Bucyrus wrote:

There is nothing to prevent their labor base from being infused with skills and competence while still retaining their low overhead advantage from their lower standard of living.  They may have a legacy of building only the frivolous products where shoddiness can be tolerated, but I think it is a mistake to believe they will remain at that station.

What I'm saying is that the advantages of having lots of cheap labor are way overstated and neglects the disadvantages.  Even now, some of the coastal areas of China have become expensive enough so that manufacturers are going elsewhere such as Vietnam.  I'd maintain that China will continue to grow at a good clip, but perhaps not at all if they don't address the severe problems that I mentioned: ecological, governance (lack of accountability and official corruption), and demographic.  Another huge problem is that their financial system is basically dysfunctional.

 Bucyrus wrote:

China consistently has graduated more engineers than the U.S., Japan and Germany combined every year since 1997, according to figures collected by the National Science Foundation in Washington.

Quote from the article:

"If the U.S. manufacturing base continues to shrink at its present rate and the critical mass is lost, the manufacturing innovation process will shift to other global centers. Once that happens, a decline in U.S. living standards in the future is virtually assured."

Again, I'd cite Japan as the historical example to compare against.  The cause and effect cited in the preceding quote had its origins in the '70s and '80s when it was noticed that Japan graduated more engineers than the U.S.  Remember the critics were moaning that all of U.S. manufacturing was going to Japan and that the U.S. was going to decline because it trained too few engineers?  What happened?  In the period 1993 to 2003 Japan's GNP grew at an annual rate of 1.3% and the U.S. grew at a rate of 3.3%, meaning that in the period the Japanese economy grew 14% and the U.S. economy grew 34%.  Some decline!  My gut feel is that China's economy (with a population 10 times greater than Japan's) will achieve a size of about 3 Japans by 2030.  After that, they'll hit a plateau.

Cue in Rod Serling on the black and white television screen.."We offer you for your consideration, an obscure oriental country.. a backwater..called Japan who was undergoing a dramatic surge of industrialisation and had an enormous apetite for raw materials they could not provide on their own soil...denied the access to these materials, a convey of airplanes we see on this date in 1945 are in enroute in a stealthy formation across the seemingly endless Pacific...their target...an unsuspecting island rising out of the sea...Pearl Harbor...It is 2007, a dragon has awakened...hungry for South American's vast resources..oil...minerals...an engigma wrapped in a riddle...Deja Vu...."

 

China's oil import volume is in increased growth while its national economy is relying more and more on imported oil. All citizens in our country are worried about the security of oil import: will the oil-exporting countries menace us with oil supply cut? Since the US, Japan and other oil-importing countries all need it, will wars break for oil when its supply fail to satisfy the demand?   Resources have always been an important cause of wars in history. Such wars had still prevailed by the first half of the 20th century, which had not changed until the end of WW as a result of economic globalization. Owing to the allocation of resources at world markets, countries and enterprises that need resources can purchase what they need at world markets rather than declare wars to occupy them. At least that is the theory history will test...

On the lighter side..maybe all of this gnashing of teeth is a moot point..maybe all we'll need is some green grass..and fresh water...

http://www.dailymail.co.uk/pages/live/articles/news/news.html?in_article_id=444436&in_page_id=1770&in_a_source=&ct=5

 

Nothing is more fairly distributed than common sense: no one thinks he needs more of it than he already has.

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Posted by Tulyar15 on Monday, March 26, 2007 1:39 AM
 doghouse wrote:

 

O/T:  Mr. smith.  That picture you have at the bottom of your posts; I know that they are from Dr Who.  However, their name(s) elude me.  Little help!?



They're called Daleks - the Dr's sworn enemies. They caused a sensation in Britain when they appeared in the 2nd story when Dr. Who first aired in 1964, and have been popular ever since.
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Posted by CNW 6000 on Monday, March 26, 2007 7:18 AM
While I normally think competiton is a good thing, in these cases IMHO it's a National Security issue.  As was previously stated (I forget by whom) if we let our industrial base leave the country we'll be at the whim of whomever has what we need.  Let's not forget that some big chunks of the world probably don't like us very much.  They tolerate us to get what they need.

Dan

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Posted by CNW 6000 on Monday, March 26, 2007 7:20 AM

 Murphy Siding wrote:
...If a Chinese designed and built jumbo jet stalls, it will come to a stop in about 30,000 feet, and wait for the fire & rescue people to arrive.Disapprove [V]

Loosely quoting Ron White: "How far will this thing go on one engine?  All the way to the scene of the crash!  I bet we beat the Paramedics by a half hour!"

Dan

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Posted by Anonymous on Monday, March 26, 2007 8:00 AM

 eastside wrote:
 Bucyrus wrote:

China does have a lot of unskilled labor, but the heart of their competitive advantage is not so much unskilled labor as it is a lower standard of living.

A low standard of living is an outcome of cheap, unskilled labor, not a separate quality.  When companies go out to the labor market they hire on the basis of skills, not living standards.  When I hire a person I look at his experience and skills, not how well he lives.  Thus his living standard gives him no more or less competitive advantage for the job.

When I said standard of living, maybe a better term would be, cost of living.  My assumption is that a person with a low standard of living would naturally have a low cost of living.  You say you only consider experience skills and not how well the prospective employee lives.  But you certainly must consider the cost of that employee.  There are cad design jobs going to India to be performed by people with the same skills as the people who had been doing them in the U.S.  Yet in India the labor rate is $7.00 per hour versus $40-50 per hour in the U.S.  If it were not due to a difference in the cost of living, how would you explain the wage discrepancy?

I agree that a low standard of living is usually combined with a prevalence of cheap, unskilled labor.  But China and India are proving that they can provide U.S. equivalent high skilled workers who are still able to work at a rate that reflects their lower cost of living.

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Posted by Krazykat112079 on Monday, March 26, 2007 8:15 AM
 Bucyrus wrote:

China consistently has graduated more engineers than the U.S., Japan and Germany combined every year since 1997, according to figures collected by the National Science Foundation in Washington.

Quantity isn't everything, though.  I have had the chance to work with and attempt to teach some graduates of Chinese colleges.  I found the few that I did work with to be horribly inept in applying their knowledge towards any sort of conclusion.  There were able to quote me equations and could provide books that talked about the subject, but would not be able to tell me what an experimental result meant.

It does not surprise me that China is graduating more engineers, but it also would not surprise me if they have lower standards to specifically be able to brag about graduating more engineers.

Nathaniel
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Posted by Modelcar on Monday, March 26, 2007 8:21 AM

....Just a small note on a date:  Those bombers came out over the Pacific to Pearl Harbor in 1941....not 1945.  Don't mean this as critical, just to keep the history correct.

Quentin

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Posted by wallyworld on Monday, March 26, 2007 8:24 AM
 Modelcar wrote:

....Just a small note on a date:  Those bombers came out over the Pacific to Pearl Harbor in 1941....not 1945.  Don't mean this as critical, just to keep the history correct.

Don't forget...that was The Twilight Zone...in other words; Rule 1..do not post before morning injection of caffeine..Like all good sociopathic dictators..Stalin and Mao took advantage of a controlled economy and brought both countries into the 20th century, by sheer force of their will imposed by dogmatic propaganda and prison camps for the use of critics to enjoy the benefits of enforced meditation...If Mao had'nt purged his enemy's in the Cultural Revolution..this discussion may have been moot. The Chinese are not to be dismissed as medieval yokels..they invented printing, gunpowder, rockets, etc when we were looking for the next stag to roast...Bear in mind, they just shot a missle to destroy a satellite..a friendly demonstration and a post it note type of reminder not to get too uppity...Wonder what they will serve instead of a bag of peanuts on the first flight? 

food,rice,chinese

The theme for this mornings ponderations..is be careful what you wish for...Nixonian wishes to re-establish relations..sell them on capitalism..bring them into the global community of capitalism..and the fine art of resource horse trading..in hindsight maybe they were a less agressive country when the topic of the day wasn't the Starbucks in the Forbidden City, but how Cho-Han's rice paddy was doin these days...

Nothing is more fairly distributed than common sense: no one thinks he needs more of it than he already has.

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Posted by vsmith on Monday, March 26, 2007 1:43 PM
 Tulyar15 wrote:
 doghouse wrote:

 

O/T:  Mr. smith.  That picture you have at the bottom of your posts; I know that they are from Dr Who.  However, their name(s) elude me.  Little help!?



They're called Daleks - the Dr's sworn enemies. They caused a sensation in Britain when they appeared in the 2nd story when Dr. Who first aired in 1964, and have been popular ever since.

EXTERMINATE! EXTERMINATE! 

They beat me to it, one of my favorite sci-fi villains of all time, heres a vintage tidbit from 1960's Dr Who

http://www.youtube.com/watch?v=oEpW8y05fD8&mode=related&search=

and while not quite Whovian canon...this is an absolute riot....

http://www.youtube.com/watch?v=2QxNJEBr_l0

Enjoy

 

   Have fun with your trains

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Posted by Modelcar on Monday, March 26, 2007 2:39 PM

 

.....W W:  Maybe we should fire a missle out into space and show the Chinese we too can shoot down info transmitting satellites.  Even their's if necessary.

Quentin

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Posted by wallyworld on Monday, March 26, 2007 2:48 PM
 Modelcar wrote:

 

.....W W:  Maybe we should fire a missle out into space and show the Chinese we too can shoot down info transmitting satellites.  Even their's if necessary.

One of the reasons the U.S and others had their collective anxiety level raised was the danger.. the already high level of risk...that the saturation of space junk poses to existing communications, spy, and weather satellites.....We litter space with garbage as though it were a limitless landfill. And so it goes.

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Posted by Modelcar on Monday, March 26, 2007 3:05 PM

....Yes, the area of rotating satellites  must be totally saturated with space junk since we've been tossing it up there since when....about 1957 or so....Perhaps one situation that provides a little help is it's mostly moving in a similar direction...{I think}.

Quentin

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Posted by eastside on Monday, March 26, 2007 5:34 PM
 Krazykat112079 wrote:
Quantity isn't everything, though.  I have had the chance to work with and attempt to teach some graduates of Chinese colleges.  I found the few that I did work with to be horribly inept in applying their knowledge towards any sort of conclusion.  There were able to quote me equations and could provide books that talked about the subject, but would not be able to tell me what an experimental result meant.

It does not surprise me that China is graduating more engineers, but it also would not surprise me if they have lower standards to specifically be able to brag about graduating more engineers.

 

A good point.  What college students major in in the U.S. is often market driven, whereas in socialist countries students often have little or no choice -- bureaucrats decide how many engineers, lawyers, accountants, teachers, etc. are needed.  Thus imbalances often arise, wasting human talent, ambition, and livelihoods.  Meeting the quota is everything, thus quality suffers.  China isn't unique in this regard.  The Soviet bloc states also produced high proportions of engineers.  I remember similar dire warnings about the “engineer gap” as a threat to U.S. security.  Needless to say, it proved to be an illusory issue, partly because any excess demand for engineers was filled by immigrants, and certainly it didn’t benefit the Soviet Union because it no longer exists.  Also if you live in a socialist economy and are guaranteed a job you don’t have as much incentive to study and try hard, unlike the U.S. where students have to compete for the best jobs.

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