HIGH MIX: Reindustrialization News for June 9, 2025
Beautiful bills and burning Waymos, fancy propellers and manufacturing fetishes
Welcome to HIGH MIX, our weekly newsletter about the reindustrialization of the United States.
“Ranked: The states paying the closest attention to America's manufacturing crisis” CALEDONIAN RECORD
Over the past 90 days, nearly 59% of U.S. states (30 out of 51) have shown concern about the rising cost of manufacturing, according to Google search data. Interest in tariffs, labor costs, and raw material prices is surging, showing that for many Americans, the state of manufacturing isn’t just a headline; it’s a growing concern.
Is “The One, Big Beautiful Bill” good for reshoring?
In short—yes, but its positive effects may be temporary.
The thousand-page bundle of legislation is controversial (to put it mildly). Debate between politicians and pundits spiraled into public feuds, and some House lawmakers were unaware of key provisions it contained—even after they’d voted on it.
The bill affects every corner of the country in some way, but I’d like to focus on its tax incentives and their role in reshoring.
Treasury Secretary Bessent took to X in an effort to promote the legislation’s positive impact on various sectors, notably manufacturing:
What he’s referring to are modifications to federal tax code—specifically Section 174.
The 2017 Tax Cuts and Jobs Act amended Section 174 in one key aspect: for 70 years, businesses had enjoyed immediate 100% deductions for expenses on research and experimentation—fueling the rise of Silicon Valley—but they were now required to amortize those deductions over a 5-15 year period.
It became known as the “tax code time bomb” as companies laid-off up to half a million engineers and developers whose salaries were no longer immediately deductible.
The Big Bill aims to undo the damage and revitalize the American manufacturing base by repealing the 2017 legislation. Companies could once again make those R&E tax deductions immediately.
Going one step further, the bill would also provide similar deductions for major manufacturing expenses—new factories, new equipment, and new research projects, with the simple goal of creating a historic boom in hard tech industries.
Some feel it’s not going far enough—the tax breaks will sunset in 2029, meaning there’s not much time to make the most out of it. (Many, like David McIntosh, president of the Club for Growth, and Jeff Yass, managing director and co-founder of Susquehanna International Group, think these deductions should be made permanent.)
If the bill is amended in the Senate, it’s sent back to the House for another vote. President Trump imposed a 4th of July deadline—something Republicans in the Senate are acutely aware of—but House members, now (finally) informed on the bill’s contents, may not reach an agreement in time.
If it’s rammed through in its current form, the bill’s tax code changes would temporarily incentivize capital allocation towards reshoring and expansion of manufacturing in the United States. Companies, founders and hard tech venture would need to be prepared to act quickly within a four-year window—not a lot of time to secure lines of capital, execute site development, and turn on the lights.
I Tried To Make Something In America (The Smarter Scrubber Experiment) SMARTER EVERY DAY
Guess what? It’s a mess. Smarter Every Day has huge reach. This would be a great opportunity for the American reshoring and manufacturing community to help them out. From the video’s description:
We are absolutely terrified of how difficult it is going to be scale up our output if there is significant demand, so please be patient with us. Our goal is to invest back into the machines and tooling to see if it's possible to make this stuff work
Also, we are nowhere in the ballpark of being ready for this... but if you're interested in being a wholesaler we'd love to get your contact information in case we figure that out for the future. Also, if you'd like to help tell this story we'd like to hear about that as well.
“Inside The Waymo Factory Building A Robotaxi Future” FORBES
Waymo isn’t an automaker per se, but rather modifies existing vehicles to their specifications as self-driving robo-taxis. Considering the business Waymo is in, it might surprise you that their Mesa, Arizona production facility isn’t highly automated—workers still do most of the assembly by hand. (And they’ll need to assemble a bit faster since several are being torched in LA.)
Inside the cavernous space, there are no conveyor belts or loud metal stamping you’d see at traditional assembly plants. The work pace is steady but not high volume. Raw cars roll into the building at one end, with plastic covers on the body panels over precut sections where sensors will be installed. They enter a manual assembly line where dozens of workers remove those covers, bumpers and other exterior components to begin the process of carefully installing an electrical wire harness, computers, sensors on each corner of the vehicle and Waymo’s telltale “top hat” unit–housing the main laser lidar for 3D vision, multiple cameras and audio sensors.
“Will European business turn away from America?” THE ECONOMIST
In short? Not entirely. While China is attempting to court the EU and pull market share away from the US, surveys show a relatively even split between European companies increasing or decreasing their investments in the United States:
Now some European businesses are rethinking their westward turn. Although a few, such as Sanofi, a French pharma giant, and Siemens, a German machinery-maker, have announced big investments to boost production in America, many others are being put off by Mr Trump’s chaotic policymaking. In a recent survey by Germany’s Chamber of Commerce and Industry, 24% of companies said they were planning to increase their investments in America, whereas 29% said they were planning to reduce them.
“The Next Car Production Crisis Could Be Caused by Magnet Shortage” THE DRIVE
The process of reshoring requires American manufacturers to detach from overseas raw materials suppliers—a monumental challenge with China producing up to 90% of the world’s finished or processed rare earths. Some hope: American EV manufacturer Lucid Motors has announced a partnership with Graphite One—a US-based mineral exploration outfit currently excavating a property on the Seward Peninsula, Alaska known as “Graphite Creek”—to supply the company with natural graphite.
Mining operations in the US are receiving fast-tracked permits, and some will benefit from more relaxed environmental regulations. With that in mind, I think we’ll see more domestic supply chain solutions in the near future, especially if companies like MP Materials can find the capital to build or restart domestic ore processing facilities. (What’s the current level of magnet production—especially the type used in electric motors—in the U.S.? If you work in the industry drop us a line.)
“GM CEO Mary Barra on Trump tariffs and US manufacturing: 'We could have done better'” USA TODAY
GM has made a variety of production changes at plants in the United States this year, including an $888 million investment the company announced late May 27 in its New York propulsion assembly plant to produce the next generation V-8 engine, the automaker’s largest ever in an engine plant. GM said April 23 that it planned to expand transmission production at its Toledo (Ohio) Propulsions Systems plant, where it builds transmissions used in the Silverado and Sierra pickup trucks.
“Can bringing back manufacturing help the heartland catch up with 'superstar' cities?” NPR
Gordon Hanson, economist at Harvard’s Kennedy School thinks we collectively have a “fetish for manufacturing, which is really unproductive.” Guilty as charged, but productivity is the whole point: factory workers are more productive than in the past—manufacturing labor productivity increased by 129% since 1987, although it peaked in 2011.
And obviously manufacturers commonly benefit other local businesses and employers, creating even more jobs:
"When a local community attracts a manufacturing plant, it attracts employment directly into that plant, but it also generates jobs outside that plant through the income that those manufacturing workers spend in the community in local services," [UC Berkeley economist Enrico Moretti] says. Manufacturing plants also create jobs at local suppliers, which provide goods and services that help them make stuff.
“Championing Manufacturing: Meet Pennsylvania’s IRC Network” PENNSYLVANIA DEPARTMENT OF COMMUNITY & ECONOMIC DEVELOPMENT
If you experienced the early internet, the phrase “IRC Network” may conjure up fond memories. In this case it refers to Pennsylvania’s Industrial Resource Center—a network of non-profits in the state who help small-to-mid size manufacturers grow. Leadership training, efficiency consultation and certification services are some of the things they offer. They’re also helping shops prepare for the future:
Our next big challenge is to scale up our capabilities to provide advanced manufacturing technologies such as Industry 4.0 and cybersecurity services to our clients. By helping our manufacturers embrace new technologies and introducing them to strategic partners that can help implement them, we’re enabling our companies to work smarter and succeed. In turn, they and their workforce can thrive and take advantage of the many amenities that Pennsylvania offers because of the higher wage and stable employment that manufacturing offers.
“Ninety-Five Percent of Manufacturers Are Investing in AI to Navigate Uncertainty and Accelerate Smart Manufacturing” BUSINESSWIRE
Rockwell Automation published their 10th annual State of Smart Manufacturing Report. Here are the key findings:
81% of manufacturers say external and internal pressures are accelerating digital transformation, with cloud/SaaS, AI, cybersecurity, and quality management ranking as the top areas of smart manufacturing technology investments.
95% of manufacturers have invested in, or plan to invest in, AI/ML over the next five years. (But for what specifically? There’s a big difference between using ML in actual production as opposed to, say, generating marketing copy.)
Organizations investing in generative and causal AI increased 12% year-over-year, signaling a maturing approach to advanced technologies beyond experimentation.
Cybersecurity ranks as the second biggest external risk, with 49% of manufacturers planning to use AI for cybersecurity in 2025 – up from 40% in 2024.
48% of manufacturers plan to repurpose or hire additional workers due to smart manufacturing investments. Additionally, 41% are using AI and automation to help close the skills gap and address labor shortages.
Quality control remains the top AI use case for the second year in a row, with 50% planning to apply AI/ML to support product quality in 2025. (Like solutions made possible by Bucket Robotics.)
“How freight rail fueled a new luxury overnight train startup” FREIGHT WAVES
California startup Dreamstar aims to connect Los Angeles to San Francisco with a luxury passenger rail service that operates on existing freight lines.
“Dreamstar started from a deeply personal frustration with the state of American travel,” said Dominic, in an interview. “After experiencing modern rail across Europe and Asia in my 20s, I kept asking, ‘Why don’t we have this in the U.S.?’ Years later, after hundreds of business and leisure trips that forced a choice between wasting precious daytime or sacrificing sleep, the idea crystallized: Build a better alternative. Dreamstar is our answer — a rail service that brings rest, reliability and elegance to medium-distance travel.”
“US small business owners struggle to diversify from China manufacturing” NIKKEI ASIA
While there are US-based manufacturers specializing in low-volume, high mix orders, there is an urgent need for more—and more variety of manufacturing processes in high-mix environments—for reshoring to gain momentum.
"Because U.S. manufacturers have such high expenses, they need to require their clients to produce in large volumes to make their businesses work," [Beth Benike, CEO of Minnesota-based Busy Baby] said. "We are simply too small to produce in high volumes."
“Heated road being installed in Grand Rapids, Michigan” REDDIT
Grand Rapids is heating an entire section of downtown Grand Rapids’ streets. It’s a safe bet this is cheaper than road closures and snow removal even with the state’s famously short, mild winters.
Anduril’s Palmer Luckey: “I’m pretty allergic to all these debates about how it’s impossible to make stuff in the United States.”
“…I’m pretty allergic to all these debates about how it’s impossible to make stuff in the United States. You’ve probably seen the stories about how iPhones would cost $30,000 if they were made here—it’s all bullshit. I know because I make stuff in the United States. The people who are saying that it will cost 100 times more are saying that because they want to make excuses for what they’re doing—they want to excuse why they’re in China.”
David Smith of Motive Machine Works quit his day job to start a CNC machine shop
David—a machinist trained at Pennsylvania College of Technology—wasn’t satisfied with his job, so he started his own shop with a variety of machines. In this video: how he got started, high-mix low-volume order flow and getting the best performance out of his machines.
“Sharrow Engineering Announces Plans to Build Nationwide Manufacturing Network” YAHOO! FINANCE
Sharrow Engineering make a unique loop-shaped CNC-machined propeller, representing the cutting edge in marine propulsion technology (aside from classified submarine applications). They also have a novel approach to manufacturing with a network of small shops to enhance production flexibility:
With demand for the Sharrow Propeller growing rapidly across recreational, commercial, and government sectors, the company is investing in a national network of advanced 5-axis CNC machine shops that meet the highest industry standards—including ISO 9001:2000 for quality management, AS9100 for aerospace manufacturing, and ITAR registration for defense-related production. This initiative leverages the existing talent, capacity, and infrastructure of the U.S. manufacturing base to scale production and support future innovation.
“China’s Manufacturing Activity Tumbles Into Contraction as Orders Drop” WSJ
The decline was mainly driven by a drop in new orders, which declined at the quickest pace in over two-and-half years, said Caixin. New export orders also reported a second month of decline and hit the lowest level since July 2023. A subindex tracking factory production fell for the first time in 19 months.
“Unlocking IIoT: Insights into Smart Sensor Technologies” AUTOMATION WORLD
With a focus on predictive maintenance and condition monitoring, the latest smart sensors deliver information and insights that enable predictive maintenance, accelerate troubleshooting, reduce downtime, improve accuracy and durability, deliver precision measurements, improve diagnostics and maximize ROI. Ultimately, smart devices are a scalable technology that lay the foundation for smarter machines, smart connected systems and knowledge-driven operations.
“US Army demonstrates frontline drone manufacturing” DEFENCE BLOG
Soldiers used Stratasys F370 3D printers configured for rapid, adaptable production. These systems enabled on-site manufacturing of drone components in response to mission-specific requirements. The approach reflects a growing emphasis on modular, expendable unmanned systems that can be produced and launched at or near the tactical edge.