Production is returned back to Finland from Asia
Helsinki (13.03.2013 – Heikki Jokinen) Finland is
producing bicycles again. The traditional bicycle factory Helkama Velox
moved the production line of its Jopo bicycles back from Taiwan to Finland
in 2010. Since then the sale of Jopo bikes has doubled.
About 24,000 bicycles will be manufactured this year, which
amounts to eight per cent of total annual bicycle sales in Finland. Many
components are still produced abroad, but more than 50 per cent is Finnish
work. The original Jopo first made its appearance in 1965 and continued in
production until 1974. With the retro boom in vogue Helkama began to make it
again in 2002 and moved production to Taiwan three years later.
The return of the Jopo factory from Taiwan to the
small Finnish coastal town of Hanko is one part of the emerging reshoring,
the return of industrial production back to Europe and the USA. The
reasons behind this are usually diminished salary differences between
countries like Finland and China, greater flexibility and the need to be
closer to customers.
According to the International Labour Organisation,
real wages in Asia between 2000 and 2008 rose by 7.1-7.8 per cent a year.
Pay and benefits for the average Chinese factory worker rose by 19 per cent
a year between 2005 and 2010. And the growing use of robots in factories
also makes the difference in salaries less important.
The employment effect is not so considerable, Helkama
Velox CEO Jari Elamo told Yle news. Helkama factory in Hanko employs 38
people and reshoring Jopo back there only added a few more jobs.
Elamo however, sees major benefits with reshoring. In
Taiwan Jopo was made in a big factory together with other bicycles on the
same assembly line. This made it difficult to react to sudden changes like
the new colour of the season.
”In Taiwan we had to know the colours five months in
advance and that is a long time in this business”, Elamo informed Yle. In
Hanko the change over to a new colour only takes a matter of hours should
another colour prove to be popular in a new season.
At the Helkama Velox factory in Hanko one worker is
putting together the whole bicycle. He or she stamps the guarantee card and
signs it. In Asian factories bicycles are made in long assembly lines.
Another company to reshore production is the Led light
producer Valtavalo, which moved back from China to Finland in late 2012.
They were able to find a suitable location in Kajaani, in the premises where
UPM produced paper until 2008.
Markku Laatikainen, Valtavalo's CEO, told Yle news
that the most important reasons for relocating to Finland were to ensure
smooth production and reliability. To have production in Finland is also
important for the company image, he says.
Reshoring to Finland is still a minor phenomenon in
comparison to moving production out of the country. Many production lines
have vanished completely. The last radio set was made in Finland in the
1990's, TV set 2005, electronic stove 2012, computer 2000 and even the last
mobile phone in 2012. The production of matches ceased in 1995 and
cigarettes in 2004.