I’d love to tackle your second question about renewables. Renewables are an extremely effective way to reduce emissions. It is undeniable that solar panels produce no carbon emissions when generating energy, unlike fossil fuels. It is true that renewables are intermittent, meaning that solar panels only generate energy when the sun is shining and wind turbines only generate energy when the wind is blowing. However, battery technology is rapidly improving and largely solves the problem of intermittency. Renewables technology is getting significantly cheaper, driving huge increases in volume and penetration. For example, residential solar panels cost less than half of what they used to a decade ago. In 2016, solar accounted for 39% of all new electric generating capacity, more than the capacity coming from all other sources, including coal and natural gas. It’s clear that renewables have an enormous impact and can help us achieve the carbon emission reductions we need to avoid the catastrophic effects of climate change.
I think you pose an interesting question. While customer are moving online, we are starting to see many companies that started with only online purchasing models to move to brick and mortar stores. For instance, Warby Parker started out with only an online presence, sending samples of their products to consumers to test before purchasing. However, now, they have stores popping up all over the country, showing the value that customers find in brick and mortar store fronts. Given this, I do not think Target should move away from their physical stores. Instead, they should add value to the in-store customer experience, with demos and other customer service offerings that can only be accessed and appreciated in person.
Really interesting article. I’ve always known that insurance companies carefully price into their insurance products the impacts of climate change, including extreme weather events and sea level rise. However, I never knew before reading this article that insurance companies themselves actually invest in renewable energy and sustainability projects. It’s a bit surprising to me as these types of investments do not have a directly measurable benefit to the Allianz’s bottom line.
As to your question about whether Allianz should invest in advocacy for public policy changes to deal with climate change risk: I absolutely believe this is a necessary investment for the long-term success of the insurance industry. As you said, unpredictable weather events pose an enormous risk for these companies and without innovative policies, such as carbon pricing or cap-and-trade programs, the negative externalities of carbon emissions will not be fully valued in the market. This is critical to slowing climate change and critical for the future of insurance companies.
Very interesting article, Paul. I’m particularly interested in your suggestion to “reform the labor and union agreements in place at the Australian shipbuilders” in order to reduce the labor costs to produce these ships in Australia versus overseas. I wonder if this would only serve to antagonize the shipbuilders, working directly against the goal of isolationism and maintaining shipbuilding in Australia. As to your question of whether it is acceptable for the Australian government to use taxpayer money for this project: I think it is acceptable to the extent they can show this is the best use of the $15 billion they’re losing due to manufacturing domestically. If this money could be spent on another initiative that employs an even greater number of Australians or gives a greater boost to the local economy, then this project becomes unacceptable.
I disagree with your position that this technology is just a method by which companies can keep their options open as the world economy swings from globalization to isolationism and potentially back again. I think that by the very nature of the cost advantage that you outlined in your article, this will be a more revolutionary technology. Although limited to repetitive tasks, this technology will continue to advance, and with this product development will surely come even further cost reductions. I believe that the isolationism we are seeing right now, while significant, is temporary. Manufacturers will continue to favor low cost solutions over labor protection, and will wield their powerful lobby to ensure isolationism doesn’t persist.
Really interesting article. Chloe. When 3D printing was first introduced to the market, the technology was prohibitively expensive for many industrial applications. My previous company used a 3D printer only for prototypes of our power inverters due to the high cost of running the printer. 3D printing makes a lot of sense for prototype production due to the high avoided cost of contracting a traditional offsite manufacturer to make a one-off part, which itself was being iterated and changed very quickly. I’d be interested to see how prices of industrial 3D printing have decreased over time and the forecasted prices. The speed of innovation here will inform the extent of investments that companies will make to integrate this new technology into their manufacturing process. Also, to build on Jon’s comment: I wonder if there are limitations to the redesign process to enable 3D printing. Are there quality losses due to the design changes that need to be made to accommodate manufacturing parts in this way?