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by hannasanarion 2255 days ago
If ramping up production were as simple as hiring 100 more people, it would have been done even if there weren't a crisis.

Capacity for manufacture is not infinite and it cannot be changed at a moments notice. It takes months or years to establish supply chains, facilities, machinery, and expertise needed to increase manufacture, and by that time the crisis is over and the extra demand is gone.

3 comments

That's only true because nobody can make a profit off extra capacity. If there was a way to make it profitable then the factories would have slack capacity built into them.
How do you know that? What if there was a factory running at less than 100% physically capacity? You could in theory ramp up production very quickly simply by hiring more people, but you won’t, because doing so incures costs (training them, giving them PPE, ...) and you can’t be sure about your income (price rises are banned, exporting is outlawed, your product might even be confiscated).
Because there were PPE manufacturers giving interviews in the press in which they pointed out that the last time they did expand their production during the crisis, the crisis ended and the demand evaporated before they've managed to recoup their investment - so they're reluctant to do the same now, unless governments sign on with long-term repeat purchase contracts.
On a side note, one could argue that if we didn't have these sorts of "anti price-gauging" price-controls, the market would more readily keep itself open and malleable to quickly ramping up production to items whose price is spiking. I.e. if there is money to be had by jumping on "hot" production items, then there is utility in spending money on being able to jump on it when needed.

So perhaps right now the supply chain isn't able to do this, but that doesn't mean it can't move towards it.