China’s manufacturing base of appliances, electronics, and robots | Rhodium Group

Electronics manufacturing expands the number of metals demanded from refineries, which in return justifies investments in companion mineral extraction capacities. Goods such as air conditioners and batteries increase the scale of major metals demand. And in metals processing, larger scale lowers costs.

Large volumes of metals consumed by prior iterations of appliances, combined with China’s production in microelectronics set up the Chinese market to succeed in the manufacturing of new era goods such as EVs, robots, and drones. While these are novel technologies, they are made of the same metals used in electronics, appliances, and toys.

By establishing the world’s largest manufacturing base, the ecosystem ensures the greatest volume and diversity of offtake for processed metals and minerals. The total volume of downstream manufacturing enhances midstream processing competition for upstream materials to fabricate or process on behalf of downstream buyers.

The relative size of China’s manufacturing ecosystem has pushed competitors such as GE Appliances, Philips Appliances, and even Sony to sell majority stakes in their appliance and television businesses to Chinese partners which localized an even great proportion of related activities in the Chinese manufacturing ecosystem. The movement toward greater localization in China is a loss to potential future commercial demand in an ex-China market...