Voice of the Modern Manufacturing Economy Since 2013

Is the manufacturer-as-tech-company narrative finally fading?

Article by Bart Taylor February 10, 2019, 10:29 am MST

We call manufacturing tech. Does it matter?

Here's a CNBC.com headline and story from last week:

It's a manufacturing story that's labeled "tech." It's common in business media. Manufacturing's not cool. Better in the publisher's mind to call it tech.

It's a line that's blurring, though. Manufacturing's brand is on the upswing. Some in the media may be catching on.  

A Business Insider columnist bemoaned the tendency of reporters to refer to Tesla as a tech company, even if he didn't go so far as calling it a "manufacturer." It might have connected his thought better:



That said, Matthew DeBorg's tip of the cap to Honda is useful. They're a car maker to respect, with a deep connection to the build, to manufacturing. DeBorg shares this anecdote, and it says it all: "'I think best when I have a wrench in my hand,' founder Soichiro Honda once said. Following in his footsteps means to know how stuff works."

Unfortunately, DeBorg spins away from the promising Tesla-as-manufacturer tangent, and back to the more conventional narrative by concluding that, "CEO Elon Musk's firm is really a design-and-engineering operation," a theme fully embraced by the WSJ's John Stoll in a column titled, "Tesla Should Pull an Apple: Leave 'Production Hell' to Other People," with a subhead, "The real money isn't in building beautiful things. It's in creating them."

It's not entirely clear where Toll suggests Tesla would go to build, or assemble, its cars, with vague references to a strategy involving contract manufacturers located in England, maybe, or the U.S. Musk already rides herd on a cadre of contract manufacturers (we've profiled several including including Scandic), and is obsessed with build quality and micro-managing even the smallest aspect of sourcing and manufacturing.

Outsourcing more manufacturing and assembly would make Tesla more like Apple, I suppose. But as we've seen, despite the media's habit today of labeling Apple a tech company and not a manufacturer, more attention is being paid by the company to where its products are manufactured and the role U.S. operations will play. It would seem Apple is moving toward a embracing a new moniker, that of technology manufacturer.

Media would do well to follow suit. Aside from the inaccuracy of labeling a manufacturing story as tech, the habit obfuscates the very real trend of technology-informed companies embracing the build, not glossing over it. Consumers -- and presidents -- increasingly hold companies responsible for the entire supply chain, not just the parts located in the U.S.

Bart Taylor is publisher of CompanyWeek. Email him at btaylor@companyweek.com.

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