"Laggards of innovation in this space... risk being clipped by a new entrant into the market." - Paul Martyn, vice president of supply strategy at BravoSolution.
A Renaissance of American Manufacturing
If just a few of these local mines pay off, he said, the result could be a total resurgence in the industrial backbone of the United States.
The U.S., he said, is primed for such a production boom. Specifically, ramping up rare earth mining locally connects three critical assets we uniquely possess:
- An innovative manufacturing industry with modern capabilities and technologies.
- A supply of rare earth metals to exploit.
- A large of the supply of natural gas, which could potentially make the fueling of both of these operations more cost effective.
"The capabilities, the energy and the supplies are working in favor of a renaissance of American manufacturing," he said. This renaissance will be pitting the U.S. electronics manufacturers against the old industry giants and could really turn the tables on the traditional markets.
"The laggards of innovation in this space -- namely Sony (IW 1000/33) and Nokia (IW 1000/61) -- risk being clipped by a new entrant into that market with improved manufacturing processes that include better equipment, more modern production capabilities and more product innovations," he said.
These past few years of price manipulations by China, he said, has created a trend moving exactly in this direction.
"What we're seeing is companies like Apple (IW 500/14) have begun to go deeper into the supply chain," he said. "We seem to be in an environment at least in the electronics industry where the pendulum for vertical integration is swinging back in favor."
At BravoSolution, he said, he has already seen several electronic manufacturers already investing in equity firms to bring that locally sources rare earth materials element into play.
"Apple, for example, has been dipping deeper and deeper into securing capabilities and supplies for this kind of operation," he said. "They have been using their significant cash reserves to acquire their suppliers."
As the world leader in innovation and high tech design, Apple's venture into the local vertical markets signals to Martyn a definite possibility of a true U.S. manufacturing renaissance.
