The era of frictionless global manufacturing is over. That’s the stark assessment from Karel Stransky, one of Central and Eastern Europe’s most experienced industrial real estate practitioners.
“What is certainly ending is borderless and tariffs-less global environment,” Stransky explains. The shift isn’t simply about factories moving from China back to Europe—it’s far more nuanced. “Rather than globalization, we would probably have more regionalization.”
This regionalization reflects a fundamental change in how companies make location decisions. Where once it was primarily about labor costs and logistics, geopolitical risk has emerged as a critical third factor. The challenge is that unlike wages and shipping times, political instability is nearly impossible to quantify, creating unprecedented uncertainty for manufacturers.
Central and Eastern Europe stands to benefit from this transformation, but not in the way many expect. Companies aren’t simply shutting down Chinese operations and relocating wholesale. Instead, they’re establishing regional production hubs to serve nearby markets—Vietnam for China, Mexico for the United States, and CEE for Western Europe.
The implications extend beyond manufacturing. Stransky points to Europe’s defense industry, which is waking up to the need to radically upgrade its speed of delivery and overall capacity. Meanwhile, the automotive sector faces its own reckoning as demand plateaus and Chinese competitors reshape global markets.
The question isn’t whether this transformation will continue, but how quickly regions can adapt to the new reality of proximity over pure efficiency.
