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Comment by transcriptase | Hacker News Reader

The general population of the Western world has no idea, or even a reflexive reaction to deny, the fact that Chinese companies in “strategic” industries are intentionally subsidized to the point that their competitors look ridiculously expensive in comparison.

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Its not just the subsidies. JLPCB is literally physically connected to LCSC electronics. This makes their margins for pick and place add-ons really good. And most of their sales are loss-leaders.

Even without subsidies this company would have structural competitive advantages over US PCB manufacturers. Its silly to think a US PCB manufacturer would be competitive in the same way without having something like the digikey warehouse and associated manufacturing chains right next door.

Exactly. And LCSC is Digikey, but far younger (2012 vs 1972), more agile, more vertically integrated, benefiting from state subsidies, heavy automation, most components physically produced nearby, etc etc. Chinese businesses are so impressive because of the whole enchilada, not just a few relatively small factors like labor cost or environmental regulations that people like to bring up in discussions like these.

There are 100.000’s pcb fabs in China, why would JlC be strategic?!

The industry is strategic. jlc and all those others exist because China has decided it wants them to exist, and did things to see to it that they exist.

There are 1000's of corn farmers in the US, because the US has decided it was strategic and sees to it that there is always a lot of corn production capacity, even if it means buying the corn itself or artificially disposing it in some other way like making a law to use ethanol.

Facts. But this has been the case for almost 70 years.

I don't see how the time matters. The original comment wondered what makes JLC strategic when there are 1000's of them.

The point was that JLC are not strategic because they are unique. The cause & effect goes the other way. JLC are not unique because their industry was strategic.

Is this really unique to China? I thought that the problem was that prices become more arbitrary and subjective than representative of cost of labor, with inter-continental trades.

... wait, does this also explain apparent advantages in software as well as disadvantages in hardware that the US has?

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