Hmm, re Toyota and Volkswagen, if I 'm not mistaken the Golf factory is virtually completely automatic, all done by robots. In this Toyota falls down, in actually using people to build things. On a cost analysis, when a car cost so little relative to a person's wages, it is uneconomic to use lots of labour to make things. However Volkswagen brings funds into the German economy, which helps the balance of imports, plus sales, service etc. I have been interested in lathes etc for some time, and they always make stuff on the cheap because that's what the consumer demands. For example a milling machine can be bought from Fleabay for £385. This is very cheap, however a chinese manufaturer was heard to say "why do you always buy the cheapest we make, and not the best ?". Answer is because if they made stuff well, and shipped it over here, the cost would be such that it would be worthwhile UK manufacturers competing. While we as a nation continue to buy the cheap Crap that comes from China, they will continue to grow strong and us weak. Sooner or later it will be nearly impossible for us to re-enter manufacturing; Far east products started off being pathetic in abilities, but they are getting better as their younger generation gets better educated and hence young designers make better, more featured products. I remember Chinese/ Japanese sayings like "don't give your enemy bullets ". Well this applies in business as well. They control many major technologies, like LCD's, components etc, and if a foreign manufacturer was threatening one of their own, I bet they would experience "difficulties in supply".
They have a plan to become the major player in technology and hence will restrict imports with artificial trade barriers, whatever, to achieve their plan. And the UK fall for it, time after time. Do you remember the enterprise zone business some years back, intended to attract foreign manufacturing to areas of Scotland ?. I remember my Dad telling me how well it was working because Chungwa were going to move a CRT plant here. However at the time LCD's were just starting to take off, the demand for CRT's was going to fall, so this was purely a tax dodge.
I think we need to change from being shop orientated to manufacturing orientated. I believe you have to automate the manufacture of low cost items, and put your effort into design, advancing our technical expertise, and producing better products, that China will have to work very hard to equal. The government will have to protect manufacturing by fair means or foul.
The UK could become a major player once again, but it will take a major change from the top down to do so.
Ken