Economy of Ideas and Future of Supply Chains

Information and ideas are the tools the automotive supply chain needs most to secure its future, said Pete Mento, managing director and practice leader of global customs and duties for Crowe LLP.

Mento, who made his remarks during the closing keynote of AIAG's Customs Town Hall, provided his take on the past several years of trade and tariff developments as well as the trends that will drive the future of trade policy and supply chain decisions.

“Our economy is based on ideas, so ideas are all that matters,” he said. “What would you rather own: one share of Apple stock or one share of Foxcon, the company that builds those ideas?”

Mento described the current state of tariffs and trade wars as “awful,” adding that they are “confusing and don’t seem worth much.” What does matter, he says, is information, ideas, and cybersecurity.

“Supply chains are not likely to be impeded physically,” he said. “This isn’t an age where you’re going to see ocean containers exploding at sea — not when it is so much easier, so much more profitable to steal things digitally.”

Technology has made it simple to steal, and that trend will only compound the problem of countries or companies unprepared to address it. And that’s not great news for the United States, he said. “We are way, way behind the curve in terms of shoring up our supply chains. In conflict defined by information, education and training will be more important than ever. So it is vital that the U.S. reverses course when it comes to its educational priorities,” he said.

Mento pointed out that India graduates more women with Ph.D.s in engineering “than the U.S. graduates engineers period.”

“We can be world leaders in information and information technology — if we want to be,” Mento said. “Now, we just have to want to be before it’s too late.”

AIAG's Customs Town Hall, an annual gathering of importers, exporters, and associated service providers, is held to discuss new and ongoing programs which impact customs clearance, compliance programs, and cost. The 2019 program — held Nov. 7, at The Mint, in Lathrup Village, Michigan — focused on developments in trade policy, discussed effective best practices for trade compliance programs, and offered critical insight into understanding how the trade and U.S. CBP can work together toward maintaining effective relationships.

SAVE THE DATE! 2020 Customs Town Hall is Wednesday, November 4th. For more information on the event and how you can get involved as an attendee, exhibitor, or sponsor, visit www.aiag.org or call AIAG Customer Service at 248-358-3003.