With the aid of a pro-manufacturing policy in Washington, what began as a shortage of shipping containers could mature into a reshoring movement

Jul 01, 2010 | 09:54 AM | Frank Haflich

After years of moving big parts of America's manufacturing base overseas, does it make sense to expect that much of it can return? While it won't be immediate, the answer in the long haul appears to be "yes."

"Bringing things back to North America is realistic," Eli Lustgarten, a veteran Wall Streeter and observer of U.S. industry who currently is senior research securities analyst for industrial machinery and equipment at Cleveland-based Longbow Research LLC.

Lustgarten noted that interest in reshoring got its start in 2008, when the global economic boom resulted in shortages of containers, upward spiraling freight rates and "massive bottlenecks in the ports." While the subsequent downturn removed many of those bottlenecks, the global economic crisis nonetheless underscored the difficulties in maintaining an "extended supply chain," forcing some companies to re-evaluate their procurement structure. "We think there's a lot of work going on looking at supply chain sources," he said.

Additionally, some plants located in fast-growing developing economies that supply both their own markets and North America are being pressed to devote a larger share of their capacity to local customers, which could encourage boosting output in the U. S.....