The 2024 Kearney Reshoring Index, released today, provides insights into the ongoing trend of reshoring and nearshoring in the United States. The report primarily focuses on import and export flows between the US and 14 Asian low-cost countries and regions (LCCRs), including mainland China, as well as import trends with Mexico and Canada.
The index reveals a continued increase in the importation of goods manufactured closer to the US market, with a corresponding decrease in imports from LCCRs. This trend, which has been developing over the past few years, suggests a shift towards domestic manufacturing and reduced reliance on offshore production.
The report notes that the decline in imports from Asian LCCRs was primarily driven by a significant reduction in Chinese imports. However, for the first time since the inaugural 2013 Reshoring Index, some Asian LCCRs other than mainland China, including Vietnam and Thailand, also saw a dip in US imports.
Meanwhile, imports from Mexico have steadily increased since the pandemic, keeping pace with Asian LCCR imports. The trend of increased Mexican imports into the US, which began in 2021, has continued to expand, with Mexico surpassing mainland China as the largest exporter to the US in 2023.
The report highlights that investments in reshoring by US companies remain strong, despite challenges such as skilled worker shortages, labor costs, and infrastructure issues. Additionally, the vast majority of leaders looking to bring their manufacturing operations closer to the domestic market are considering the US as their preferred location.
The findings of the Kearney Reshoring Index underscore a decisive shift in strategic business operations towards manufacturing products closer to the US domestic market. This trend is expected to continue in the future, as companies seek to optimize their supply chains and reduce their reliance on distant offshore production.
