Time to buy America?
Manufacturing magnate Rob Hattin thinks it makes sense.
Canada’s small and medium-sized manufacturers – long accustomed to being thrashed by a volatile dollar, stacked border, plunging prices, polar vortexes and any number of other macro-economic vexes – may finally be able to take a long, full breath of fresh air.
And once they do that, they should head to the US and buy a company.
At least that’s what Robert Hattin thinks. And don’t kid yourself – he may be on to something.
Hattin, a businessman, founder of automation integrator ProVantage Automation, chairman of the Canadian Manufacturers & Exporters (CME) and hard-talking, good-natured provocateur, made his case in May at the Manufacturing Canada Conference at the Mississauga Convention Centre.
The pitch goes something like this:
The US economy is the largest, most dynamic in the world.
This economy is our largest trading partner and, in the case of many companies, our sole customer.
Having experienced recent economic shock, the US market has begun a process of retrenchment, compelling its captains of industry to return home and its industrial consumers to purchase products made within the market.
The call has been heeded. And with relative disregard to long-standing trade agreements, Canadian firms are now more often being shut out of certain industries in which they once enjoyed a market-leading position – defense and infrastructure, to name two.
However, Canada is looking at a resurgent manufacturing sector buoyed by low interest rates, a low-ish dollar and a beleaguered manufacturing base south of the border looking for relief.
Let’s buy America
So, instead of duking it out with other Canadian firms over limited geographical and sectoral turf, why not acquire an American company?
Underpinned by the relative strength of ongoing Canadian operations, you could then buy a shop in the US, be eligible for contracts under the bemoaned Buy American Act, and leverage the structural weakness of regional US markets to expand your business.
Buy Americans, if you will.
A bold move not without risk.
But Hattin thinks there is less risk than we may think.
“Business as usual is no longer an option, and we have to figure out other ways to continue to participate in the largest economy in the world,” Hattin said during his closing remarks at the conference.
“Let’s Buy America. Let’s invest in America. It’s time to turn risk into courage. But do you have the courage to be transformative?” he asked.
Good question, Mr. Hattin. But will manufacturers have an answer?
Michael Ouellette is the editor of CanadianManufacturing.com and former associate editor of PLANT.
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