The fact that China has emerged as a manufacturing powerhouse is old news.  Many electronics OEMs in the US, Europe and Japan found a way to produce more competitive products by outsourcing their manufacturing of low cost products to China (and India and now Viet Nam,...).  Over time, as China further developed their manufacturing they grew from lower cost consumer products to all but the most advanced technology.  So great!   We all got to stay competitive and capitalize on the cheaper labor costs found in these countries.

But look at what is happening now.  No longer is China relegated to manufacturing.  Now many of those manufacturers are designing products as well as manufacturing them and we see a consistent shift by both global and Chinese companies to capitalize on the wealth of highly educated engineering talent in China.  I personally take several trips to China each year to speak at PCB systems design seminars that Mentor sponsors.  Each year we see a growing thirst by these engineers to learn of the latest technologies and processes the Mentor supports and how they can better compete in the global economy.  Each year we see increasing sales of our most advanced design tools as the Chinese companies upgrade from low-end mom and pop design shops into mega enterprises.

So where is it all going?  I would love to get your thoughts.  Will China, then India, then Viet Nam, then the Eastern Bloc countries, .... end up with all the engineering talent, and today's electronic powerhouses in the US, Europe and Japan lose the ability and economic justification to develop their intellectual property?  I hope not.  But what's the answer?