Why it’s so difficult to manufacture in the U.S. – CNBC

Guardian Bikes’ Domestic Manufacturing Initiative: A Report on Sustainable Development Goal Alignment

Introduction: Reshoring in the Context of Sustainable Development

This report analyzes the domestic manufacturing operations of Guardian Bikes in Seymour, Indiana, with a specific focus on its alignment with the United Nations Sustainable Development Goals (SDGs). The company’s initiative to produce children’s bicycles in the United States presents a case study in the pursuit of localized, sustainable economic models.

Advancing Decent Work and Industrial Innovation (SDG 8 & SDG 9)

Revitalizing Domestic Industry and Job Creation

Guardian Bikes’ operation directly contributes to key targets within SDG 8 (Decent Work and Economic Growth) and SDG 9 (Industry, Innovation, and Infrastructure) by re-establishing a manufacturing presence in a sector largely offshored since the late 20th century.

• Economic Growth (SDG 8): The 540,000-square-foot facility produces approximately 12,000 bikes per week, creating local jobs and contributing to the economic diversification of Seymour, Indiana. This counters the trend that saw a 25% drop in U.S. manufacturing firms between 1997 and 2023.
• Industry and Innovation (SDG 9): By opening a new plant in 2022, Guardian Bikes is investing in resilient infrastructure and promoting inclusive and sustainable industrialization. The use of automation to offset higher labor costs demonstrates a commitment to technological upgrading and innovation within its industrial processes.

Fostering Responsible Consumption and Production (SDG 12)

Reconfiguring the Supply Chain for Sustainability

The company’s strategic pivot from reliance on a Chinese Original Equipment Manufacturer (OEM) to domestic production addresses core principles of SDG 12 (Responsible Consumption and Production).

1. Sustainable Production Patterns: The move was prompted by long shipping times and quality concerns, which inherently conflict with sustainable and efficient production. By manufacturing domestically, Guardian Bikes reduces the carbon footprint associated with long-distance freight and gains greater control over product quality and durability.
2. Financial Sustainability: The operational model achieves cost parity through a combination of automation, reduced inventory costs, and favorable tariff structures. This demonstrates that sustainable production models can be economically viable.
3. Partnerships for the Goals (SDG 17): The initiative was made possible by $19 million in financing from JPMorgan, highlighting the critical role of partnerships between financial institutions and the private sector in funding sustainable development projects.

Challenges to Building a Sustainable Domestic Ecosystem

Supply Chain Gaps and Economic Hurdles

Despite its progress, Guardian Bikes’ experience illuminates significant challenges to achieving fully sustainable domestic production in line with SDG 9 and SDG 12.

• Incomplete Domestic Supply Chains (SDG 9 & 12): A primary obstacle is the lack of U.S.-based, at-scale manufacturing for essential bicycle components like chains and reflectors. This forces a continued reliance on global suppliers and highlights a critical gap in the domestic industrial ecosystem.
• Global Competition: Established manufacturing hubs in China and Vietnam present formidable competition, backed by extensive investment in infrastructure and skilled labor.
• Economic Trade-offs: Experts caution that widespread reshoring without efficient production methods could lead to higher consumer prices, potentially impacting economic accessibility and living standards, a consideration relevant to the broader goals of sustainable economic policy.

Analysis of SDGs in the Article

SDGs Addressed

• SDG 8: Decent Work and Economic Growth – The article focuses on the revival of manufacturing in the U.S., job creation, and economic productivity through a domestic company, Guardian Bikes.
• SDG 9: Industry, Innovation, and Infrastructure – The core theme is industrialization, the challenges of building a domestic supply chain, the use of innovation (automation), and the role of financial infrastructure in supporting manufacturing.
• SDG 12: Responsible Consumption and Production – The shift to domestic manufacturing is linked to reducing long shipping times and improving quality control, which points towards more sustainable and efficient production patterns.

Specific Targets Identified

• SDG 8: Decent Work and Economic Growth

  • Target 8.2: Achieve higher levels of economic productivity through diversification, technological upgrading and innovation.
    • The article explains that Guardian Bikes offsets the “higher cost of producing domestically” with “automation,” which is a direct example of using technological upgrading to improve productivity.
  • Target 8.3: Promote development-oriented policies that support productive activities, decent job creation, entrepreneurship, creativity and innovation.
    • The article highlights how politicians “call for reshoring” and mentions federal subsidies under the CHIPS Act, which are development-oriented policies. The story of Guardian Bikes itself is a case study in entrepreneurship and innovation in the manufacturing sector.

• SDG 9: Industry, Innovation, and Infrastructure

  • Target 9.2: Promote inclusive and sustainable industrialization and, by 2030, significantly raise industry’s share of employment and gross domestic product.
    • The article is centered on the effort to bring manufacturing back to the U.S. It notes that between 1997 and 2023, “the number of U.S. manufacturing firms and plants dropped by 25%,” directly addressing the need to reverse this trend and promote industrialization.
  • Target 9.3: Increase the access of small-scale industrial and other enterprises… to financial services, including affordable credit.
    • The article provides a concrete example of this target being met: “Starting in 2022, Guardian opened its own plant in the Midwest with the help of $19 million in financing from JPMorgan.”

• SDG 12: Responsible Consumption and Production

  • Target 12.2: By 2030, achieve the sustainable management and efficient use of natural resources.
    • The company’s pivot away from Chinese manufacturing was prompted by “long shipping times.” Producing domestically reduces transportation distances, leading to a more efficient use of resources like fuel. The mention of “lower inventory costs” also points to more efficient management of materials.

Indicators for Measuring Progress

• SDG 8: Decent Work and Economic Growth

  • Indicator (Implied): Manufacturing Productivity Rate. The article states that Guardian Bikes “produces about 12,000 bikes per week,” which serves as a direct measure of the company’s productivity.

• SDG 9: Industry, Innovation, and Infrastructure

  • Indicator (for Target 9.2): Manufacturing’s share of the economy. The article provides a specific data point that can be used as a baseline indicator: “the number of U.S. manufacturing firms and plants dropped by 25% between 1997 and 2023.” Progress would be measured by a reversal of this trend.
  • Indicator (for Target 9.3): Proportion of small-scale industries with a loan or line of credit. The article gives a specific example that serves as an indicator: the “$19 million in financing from JPMorgan” provided to Guardian Bikes.

• SDG 12: Responsible Consumption and Production

  • Indicator (Implied): Reduction in shipping distances. The article’s reference to “long shipping times” as a reason to move production domestically implies that a key metric for success is the reduction of transportation-related impacts.
  • Indicator (Implied): Inventory efficiency. The article mentions “lower inventory costs” as a benefit of domestic production, which can be measured as an indicator of more efficient resource management.

Summary Table of SDGs, Targets, and Indicators

Source: cnbc.com