American Televisions and Electronic Products

I recently bought a Westinghouse television set, a 55 in. (diagonal) flat screen LCD, thinking it was made in the U.S.A. The sales clerk assured me that it was made in California by a California company that had bought the Westinghouse brand from the original owners of Westinghouse.

I did not follow Reagan’s trust but verify dictum and bought the TV on the basis of the clerk’s word. Turns out the TV that I bought was made in China by a Taiwanese company called Chei Mei.  All Westinghouse TVs are made in China.

You would think that someone like me who is deathly serious about manufacturing products in the U.S. would know that no TVs are made in the U.S. these days. But, I was hoping that there had been recent changes in the market that I was not aware of. After all, the U.S. has not completely given up on electronics manufacturing. There are specialty products that are still made in the U.S., in the high-end market where price does not matter as much as quality.

Bose products are, after all, still made in the U.S. Probably the finest speakers in the world, Bose boasts of theater quality sound that emanates from small boxes.

There are dozens of U.S. manufacturers that still make their products in America. Some of the notable ones are:

Sirius – which makes data bases for electronic engineers
Sonetronics – makes headsets, earphones, etc.
B & K Manufacturing – high end audio equipment
Krell – home theaters and high end audio and video equipment
Crowley and Tripp – American designed, assembled and serviced microphones
Martin Logan ESL – speakers for audiophiles

There are numerous small American manufacturers that provide niche products in the humongous electronics market in the U.S.

Why no one has started to make TVs in America again is probably a function of the cost of labor in China. Taiwanese companies make their TVs in China because production costs there are much lower than in Taiwan.  Japanese companies have not succumbed to the lure of Chinese manufacturing as yet because they have good business relationships with Southeast Asian countries such as Malaysia and Singapore. South Korea seems to be resisting the temptation of shifting manufacturing facilities to China and the U.S. probably has much to learn from the Samsung conglomerate. How does South Korea manage to compete with companies that have outsourced their manufacturing to China, Malaysia and other low-wage countries?

U.S. multinational companies probably have already learned from the South Koreans but they are not prepared to apply the knowledge they’ve gained. For various reasons, chief among which is probably that U.S. multinationals that manufacture in China are driven by only one consideration – the bottom line.

They leave corporate responsibility and other elusive moral considerations to the smaller manufacturers that are driven less by the need to keep the company stock’s prominence on the New York Stock Exchange than by their moral obligation to their fellow Americans.

This is the reason for my proposed new American doctrine: 51% of all manufactured products sold in the U.S. must be made (assembled) in the United States.

If we don’t force the issue, Satan will be wearing a fur coat before the conscience-deprived multinational CEOs start manufacturing big-time in the U.S. once again. Apple, the most valuable company in the world, is the biggest culprit. Apple sells so much product in the American market and yet it makes next to nothing in the U.S.

Toyota, Nissan, Mercedes, Honda and Hyundai all make some of their cars in the U.S., but Apple hardly makes anything here. This is a mortal sin.

The same guys who extol American ingenuity and hard work almost daily do not believe in those American virtues! Apple is Apple because it is making money the easy way and not the responsible way.  Not through ingenuity but by handing over its manufacturing to the cheap labor Chinese. My intention is not to demean the Chinese. They happen to be sitting on a mountain of advantage in the comparative advantage game – they can make things cheaper than just about everybody else. And they can do everything fast – a sign of high intelligence which appears to be present even among the masses. It is not their fault that they have this advantage over us, but it is also true that the Chinese have given us little in exchange for their access to the U.S. consumer market, an access that in some industries is approaching complete dominance.

But the Chinese also manipulate their currency and the rising Chinese wages are not being felt in the trade wars because of the currency manipulation.

It is time for the U.S. to step in and act.

By the way, the Westinghouse VR-5535Z 55-in. LCD TV is working just fine. I could not resist buying the product because it was selling for only $598, while the Sony 42-in. that I had bought only a few years ago cost me more than $1000 – and it was on sale!