Roseburg Coos Bay Crescent City Yreka Klamath Falls Medford Grants Pass Manufacturing in China has boomed over the last 40 years, due in large part to the country’s low cost of labor, lack of regulatory compliance and low taxes, leading some economists to dub China “The World’s Factory.” But supply-chain issues — caused by China’s port shutdowns during the COVID-19 pandemic, as well as the country’s aging population and concerns over potential military conflict with the United States—have made some companies rethink their manufacturing operations and bring a new wave of highly skilled manufacturing jobs to the U.S. It’s possible Oregon could see more onshoring efforts, with manufacturers like Lu undertaking projects to return manufacturing to American shores. The bounce could be especially potent in the clean-energy sector, where Oregon provides added incentives and Chinese companies have a decaying monopoly. Though it will manufacture battery modules domestically, QPO’s supply chain won’t be 100% American-made at first. The manufacturing of battery cells, which store power, versus battery modules or packs, which hold and dispense the power, requires different processes: Battery cell production is primarily a chemical process, while module production is an industrial, mechanical process that turns the cell into a usable battery module. For now, Lu is buying cells from China. QPO’s operation won’t cause any production facilities in China to shut down, either, but Lu is investing $7 million into a production plant to manufacture inverters, which converts direct current power into alternating current power at a higher voltage, in Tualatin. Lu says finding a domestic partner to supply the cells is high on his company’s list of priorities, in part because of the concerns he and other manufacturers have about China’s future as the center of global manufacturing. “We felt making products in China was a problem. The costs are getting higher and higher, and there are more and more competitors, and we don’t have enough profit to cover the cost,” Lu says. JASON E. KAPLAN JOAN McGUIRE Joseph Lu at QPO’s temporary headquarters in Sherwood 37
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