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Manufacturers Ask for Feds to Help Re-tool Factories

Manufacturers Ask for Feds to Help Re-tool Factories

David Greenfield -- Control Engineering via YellowBrix

September 14, 2009

A group of manufacturing industry representatives—including the National Association of Manufacturers, American National Electrical Manufacturers Association, the Manufacturers Alliance, and Rockwell Automation—has gone on record noting that a federal strategy and support is critical if American manufacturers are to thrive in the post-recession global economy.

This transformation to smarter, safer, and more sustainable manufacturing provides an opportunity for the federal government to help develop and make innovations in American plants to keep them competitive and to promote a sustainable U.S. manufacturing employment base, industry representatives said.

“We all are pleased that President Obama has named a manufacturing czar to coordinate federal policy and programs to help U.S. manufacturers,” Keith Nosbusch, Rockwell Automation chairman and CEO said. “Until 1990, federal support for applied research, which is most critical for manufacturing, was equal to federal funding for basic science. But today it is about 30% lower with nearly a $10 billion gap that needs to be remedied. Congress also needs to expand federal tax credits to apply to investments in smart, safe and more sustainable manufacturing technologies.”

U.S. industry is in a battle not just with countries with lower costs, but also with developed countries that are investing in new technology, said Emily DeRocco, president of the Manufacturing Institute and vice president of the National Association of Manufacturers. “With high quality, inexpensive products flooding the market from every corner of the globe, competing on cost alone is a losing battle for most U.S.-based manufacturers,” she said.

The cost of manufacturing in the United States is nearly 18% higher than in America’s nine largest trading partners, DeRocco said. That puts the 13.8 million manufacturing jobs in the United States at risk. Conversely, the European Union already has allocated about $2 billion to encourage its manufacturers to invest in the next generation of technology for energy efficiency and productivity.

Most energy efficiency has come from implementation of new technology, said R. Neal Elliott, associate director of research at the American Council for an Energy-Efficient Economy. “We estimate that two-thirds of energy efficiency gained in the past 20 years has come from the application sensors and controls,” Elliott said. “We can reduce manufacturing energy intensity by more than half in the next 20 years as we begin to integrate smart technology not just into equipment but into entire manufacturing systems, plants and, ultimately, into the entire supply chains.”

Federal policy needs to support three things: research, a level playing field for trade, and a tax and regulatory environment that spurs innovation, said Thomas J. Duesterberg, president and CEO of the Manufacturers Alliance/MAPI. “It is high time for Washington to recognize that the policy environment matters to the ability of manufacturers to compete successfully in our globalized economy,” Duesterberg said. “‘Smart, Safe and Sustainable Manufacturing’ is not a slogan. It’s a blueprint for success in the world economy and improving our standards of living.”

Industry leaders requesting government action recommended the following federal actions:

  • Ensure legislative priorities are in line with those of manufacturers and the general public;
  • Double federal funding for manufacturing innovation;
  • Establish a $2 billion public-private partnership program to research and develop a manufacturing “greenprint” for smart, safe and sustainable manufacturing;
  • Provide federal assistance for public-private partnerships to create demonstration projects that foster manufacturing innovation; and
  • Expand federal tax credits to apply to investments in advanced technologies that automate and modernize factories.

- Edited by David Greenfield, editorial director Control Engineering Sustainable Engineering News Desk

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