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Paradigm Shift in the Definition of ‘Domestic’: A Global Perspective Yunus Çengel Professor Emeritus

Paradigm Shift in the Definition of ‘Domestic’: A Global Perspective Yunus Çengel Professor Emeritus of Mechanical Engineering University of Nevada, Reno (USA) 1 st International Conference on Innovations in Natural Science and Engineering Famagusta, N. Cyprus January 3 -6, 2018

Why Domestic?

Why Domestic?

Q: Why domestic goods & services? A: The benefits it provides to nation/citizens •

Q: Why domestic goods & services? A: The benefits it provides to nation/citizens • Job creation, • Skills (know-how) accumulation, • Continual tech. development & leadership in technology • Derivative product potential, • Establishment of a powerful information ecosystem and innovation chain, • Reducing foreign dependence on technologies (esp. critical ones) • Full control over products & ability to use them w/o imposed restrictions • Secrecy and national security, • High prestige and high moral, • Strengthening national pride, increasing sense of belonging • Foreign currency gain; better current account balance, • Etc.

OLD paradigm in ‘domestic’ (INPUT based): Domestic goods: Those produced in the nation, with

OLD paradigm in ‘domestic’ (INPUT based): Domestic goods: Those produced in the nation, with domestic parts by national work force. Domestic firms: Those which produce in the nation using domestic parts and employing nationals.

NEW paradigm in ‘domestic’ (OUTPUT Based): • The most domestic or national product of

NEW paradigm in ‘domestic’ (OUTPUT Based): • The most domestic or national product of a country is one that is made by a company belonging to that country and provides the highest benefit to the people of that country regardless of the ratio of the domestic parts used and the country in which it is developed or manufactured. • The most domestic or national company is the one that belongs to that country and provides the highest benefit to the people of that country regardless of the ratio of the domestic parts it uses and the country where the manufacturing plants and research centers are established.

Realities of the new ‘Global World’: • Firms see the whole world as the

Realities of the new ‘Global World’: • Firms see the whole world as the potential production sites, suppliers and markets. • A national company of a country today may become part of a company of another country tomorrow. Large companies often take over other companies, license technology and even merge with companies from other countries. • Even rival companies initiate joint R&D programs to gain competitive advantage in global competition by reducing the cost of technology development. • To attempt to manufacture all products domestically will not bring about making the market domestic; it will hand over the market to foreign products since domestic products will no longer be competitive. • Governments’ desire: High domestic production Individuals: High quality, low cost products or services.

Rational approach to ‘domestic goods’: • In this age when products know no national

Rational approach to ‘domestic goods’: • In this age when products know no national borders, and technology advances in dazzling speed, a country must determine the areas/products/services for which it can be competitive in the global arena after a careful analysis, and to focus its activities in those areas only, instead of attempting to manufacture everything domestically. • Those who try to do everything cannot do anything economically, and cannot become competitive in anything. Also, they cannot improve and sustain what they do since they cannot allocate sufficient resources. • Forcing the use the parts that do not have these qualities just because they are domestic means promoting products that lack global competitiveness due to low quality and high cost. • Job creation and developing/producing high value added products should not be mixed with each other.

Smart move in ‘parts manufacturing’: Manufacture parts that can be marketed globally • The

Smart move in ‘parts manufacturing’: Manufacture parts that can be marketed globally • The goal of parts manufacturing should be to gain a significant share in the global market, instead of to save the money spent on imported parts. • Infrastructure should be established to improve the parts constantly with necessary R&D investments and to remain competitive. GE, CFM, Pratt & Whitney and Rolls-Royce do not manufacture aircraft. But they manufacture almost all the jet engines of commercial aircraft and they share the market of $25 billion a year. http: //www. statista. com/statistics/261934/world-commercial-aircraft-engine-manufacturer-market-share/

North Korea vs. South Korea: Closed&Independent vs. Open&Dependent economies N. KOREA S. KOREA Population

North Korea vs. South Korea: Closed&Independent vs. Open&Dependent economies N. KOREA S. KOREA Population 25 million 51 million Area: 120, 000 km 2 100, 000 km 2 GDP (2013): $15 billion $1, 306 billion GDP per capita: $620 $26, 000 Foreign trade volume $7 billion $1, 100 billion Economy: Closed Open (Global) Goal: Self-sufficiency High ranking global economy (now 11 th) GDP per capita (1960): North Korea: $384 South Korea: $156

North Korea vs. South Korea: Variation of GDP per capita over years

North Korea vs. South Korea: Variation of GDP per capita over years

BOEING 787: %65 of parts are imported • Boeing (2015 revenues: $96 billion) imports

BOEING 787: %65 of parts are imported • Boeing (2015 revenues: $96 billion) imports most parts used in airplanes it manufactures. • Boeing and other US aviation companies focus on parts that they can remain competitive globally and retain this competitive edge through continuous innovation. • As a result of focusing, the US exports of aircraft parts reached $56 billion in 2014. • 65% of the parts used in Boeing 787 come from outside the US. • This does not change the fact that Boeing airplanes are US products. http: //trade. gov/topmarkets/pdf/Aircraft_Parts_Top_Markets_Report. pdf ; https: //en. wikipedia. org/wiki/Boeing

Q: Which parts of i. Phone does Apple manufacture? A: None (just integration) Total

Q: Which parts of i. Phone does Apple manufacture? A: None (just integration) Total cost for Parts&Manufacturing 32 -GB: Cost: $208; Price $749 64 -GB: Cost: $218; Price: $849 Profit: Over 50% (S&P 500 Automotive: 4%) 2016 revenue: $216 billion CPU (A 7): SAMSUNG DISPLAY: JAPAN DISPLAY, LG, SHARP BATTERY: SONY CHIPS: TOSHIBA, San. Disk, ELPIDA, . . RF TRANSCEIVER: QUALCOMM i. OS (Software): APPLE MAKER of i. Phone: FOXCONN (China) Q: Is i. Phone with ‘Made in PRC’ label on it a Chinese product or US product? Source: http: //www. eeherald. com/section/news/onws 20130929006 f. html/; http: //www. isuppli. com/Teardowns/News/Pages/Default. aspx

APPLE: A desirable or undesirable firm for US? Is Apple a good model for

APPLE: A desirable or undesirable firm for US? Is Apple a good model for others to follow? Multi-national US firm APPLE (2016) • Market value: $750 billion (#1 in the world) • 2016 revenues: $216 billion. Profits: $46 billion • Cash it has: $203 billion • Employment: 115 bin (world wide) • Parts manufactured inhouse: %0 (software only). • Designed in: California, ABD • Manufactured in: China (Foxconn) https: //en. wikipedia. org/wiki/Apple_Inc. http: //www. cnbc. com/2015/07/21/just-how-much-cash-does-apple-have. html

APPLE: The firm that makes us question what ‘domestic’ is • Is Apple, which

APPLE: The firm that makes us question what ‘domestic’ is • Is Apple, which has its products manufactured in a foreign country by a foreign company with mostly foreign parts, a domestic company for the US that needs to be cherished by the US? • Should products with low domestic content like i. Phone in the US be viewed as domestic or foreign products? • Are the ordinary US citizens and US government happy that the Apple company was founded in the US, or are they bothered by it? • Is i. Phone known as a product of USA or China? • Do we wish to have a company like Apple, or, a company that manufactures its products in our country using mostly domestic parts even if it is not globally competitive?

An Example of ‘Apple Model’ in Turkey: Air. Ties ‘Designed in Turkey, Manufactured in

An Example of ‘Apple Model’ in Turkey: Air. Ties ‘Designed in Turkey, Manufactured in China’ • • R&D and Design in Turkey, Patents from US and inhouse in Turkey, Manufacturing in China, Worldwide sales (%90 export) Bülent Çelebi, Founder (Founded: 2004) http: //www. dunya. com/guncel/dunyaya-teknoloji-satiyor-ama-kamu-ihalelerine-girmiyor-256671 h. htm

Consequences of new paradigm ALTERNATIVE INOVATION

Consequences of new paradigm ALTERNATIVE INOVATION

An Indicator of Knowledge-Based Economy: Fraction of Intellectual Property (2015: 84% http: //www. oceantomo.

An Indicator of Knowledge-Based Economy: Fraction of Intellectual Property (2015: 84% http: //www. oceantomo. com/blog/2015/03 -05 -ocean-tomo-2015 -intangible-asset-market-value/

Cross-border licensing and royalty income: (2013 global total: $255 billion) Billion USD 2013: $255

Cross-border licensing and royalty income: (2013 global total: $255 billion) Billion USD 2013: $255 billion Source: WIPO (World Intellectual Property Organization) http: //www. wipo. int/export/sites/www/freepublications/en/intproperty/944/wipo_pub_944_2011. pdf

Technology licensing income of Qualcomm: $8 billion/year (2015) • US-based Qualcomm Inc. develops mobile

Technology licensing income of Qualcomm: $8 billion/year (2015) • US-based Qualcomm Inc. develops mobile technologies (5 G, Io. T). • Revenue from chip sales: $17 billion/year ($2 b profit). • Revenue from Technology Licensing: $8 billion/year ($7 b profit). https: //finance. yahoo. com/news/qualcomm-gets-majority-profits-licensing-140637621. html (17 Dec 2015)

PATENTS: A Measure of Technological Advancement No. of patents granted by countries (2014) Turkey:

PATENTS: A Measure of Technological Advancement No. of patents granted by countries (2014) Turkey: 1, 176 https: //en. wikipedia. org/wiki/World_Intellectual_Property_Indicators

R&D Expenditures, Patent applications and Export of High-Tech Products 2005 -2014 average Country EU

R&D Expenditures, Patent applications and Export of High-Tech Products 2005 -2014 average Country EU USA Germany China Israel Korea OECD Poland Singapore Turkey Per billion $ R&D spending: Export of R&D No. of patent high-tech No. of patent spending, * applications products, applications Billion $ 305 (%2. 0) 361 (%2. 7) 87 (%2. 8) 210 (%2. 0) 9. 1 (%4. 1) 51 (%4. 2) 997 (%2. 4) 5. 6 (%0. 9) 7. 5 (%2. 0) 9. 6 (%0. 9) 135, 612 487, 232 61, 296 455. 711 7, 029 178, 656 1, 269, 976 3, 878 9, 543 3, 142 605 173 169 393 7. 4 110 1124 7. 5 120 1. 7 446 1350 705 2170 772 3503 1274 693 1272 327 Export of high-tech products, Billion $ 2. 0 0. 5 1. 9 0. 8 2. 2 1. 1 1. 3 16. 0 0. 2 *(2013 R&D spending/GDP ratio, %) http: //anahtar. sanayi. gov. tr/tr/news/ar-ge-harcamalarinin-yuksek-teknolojili-urun-ihracati-uzerindeki-etkileri-turkiye-incelemesi/9407

Welcoming foreign brain power: SILICON VALLEY • Silicon Valley is just the ground of

Welcoming foreign brain power: SILICON VALLEY • Silicon Valley is just the ground of brain power and creative thinking, not the source. • Silicon valley is merely the field where the orchards of creativity (that blossomed in the garages) are planted. • “Today, knowledge and skills now stand alone as only the source of comparative advantage. Silicon Valley and Route 128 are where they are, simply because that is where the brain power is. ” Lester Thurow, MIT Economist • “In the U. S. immigrants have founded 52 percent of Silicon Valley’s companies and created millions of jobs. ” Vivek Wadhwa, Washington Post, Oct. 4, 2011. • YÖK rule for Turkish universities: “Foreign faculty members cannot exceed 2%”.

Foreign-born scientists in top 10 US universities: 76% of patents

Foreign-born scientists in top 10 US universities: 76% of patents

Investing in where Brains are: Chinese Companies Invest in US R&D Labs • In

Investing in where Brains are: Chinese Companies Invest in US R&D Labs • In the US, there are over 800, 000 people with research doctoral degrees in science, engineering, and health. • Annual flows of Chinese FDI into US was $14. 3 billion in 2013 and $11. 9 billion in 2014, • Huawei is a world leader in producing telecommunications equipment and has 6 U. S. research centers. • German companies extracted 1, 416 patents in 2014 using U. S researchers. • Investment by Chinese companies in U. S. research labs is yielding a fast-growing trove of patents, part of a push to mine America for ideas to help China shift from being the world's factory floor to a driver of innovation. June 22, 2015 http: //www. reuters. com/article/2015/06/22/usa-china-investment-id. USL 1 N 0 Z 52 TZ 20150622

Going Where the Action is/Brains are: Samsung launches Silicon Valley incubator http: //venturebeat. com/2013/0

Going Where the Action is/Brains are: Samsung launches Silicon Valley incubator http: //venturebeat. com/2013/0 7/12/samsung-launchessilicon-valley-incubator/ July 11, 2013 • Samsung opened the doors of a startup and entrepreneurship incubator/accelerator nestled in the heart of Silicon Valley. • Samsung will also open a new Samsung Strategy and Innovation Center in Palo Alto, and incubators in other tech hubs such as New York, Austin, Boston, Russia, and Israel. Samsung Ventures America is a $1 billion fund.

Adding a Research Base in a US University: Toyota teams up with Stanford &

Adding a Research Base in a US University: Toyota teams up with Stanford & MIT &UM on driverless cars April 2016 • In 2015 Toyota announced a $1 billion Advanced Projects Lab in Silicon Valley to expand its research in autonomous driving and AI. • Univ of Michigan is Toyota’s 3 rd university collaboration in the US after Stanford and MIT to try to advance its efforts in autonomous driving. • Toyota also bought the entire staff of Jaybridge Robotics in Cambridge. http: //www. wsj. com/articles/toyota-teams-up-with-university-of-michigan-researchers-on-autonomous-driving-1460056847

Investing in Start-Up Companies: FORD invests $1 billion in ‘self-driving car’ AI firm Feb

Investing in Start-Up Companies: FORD invests $1 billion in ‘self-driving car’ AI firm Feb 10, 2017 • Ford is investing $1 billion over 5 years in the artificial intelligence (AI) startup ARGO to further the development of autonomous vehicle technology. • Ford working to develop a new software platform for its fully autonomous vehicle, expected in 2021. It could also license the software to other carmakers. http: //www. cio. com/article/3168780/car-tech/ford-to-invest-1 b-in-ai-startup-toward-self-driving-cars. html

Investing in Global Start-Up Companies: Samsung invests $18 M in Israeli firm on fast-charging

Investing in Global Start-Up Companies: Samsung invests $18 M in Israeli firm on fast-charging Aug 19, 2015 • Store. Dot, an Israeli startup that makes ultra-fast charging batteries using bio-organic technology, has raised $18 million for electric car batteries. • Store. Dot’s goal is to build the “first ever instantly-charging car prototype” (charging in 5 minutes). • Another goal: to fully charge a smartphone in 30 seconds. • Samsung and LC Chem are EV Battery manufacturers. http: //venturebeat. com/2015/08/19/storedot-raises-18 m-to-help-build-instantly-charging-batteries-for-electric-cars/

A Short Cut to Becoming a World Brand-Name: BUY a World Brand (IBM); BECOME

A Short Cut to Becoming a World Brand-Name: BUY a World Brand (IBM); BECOME a World Brand (LENOVO) • Founded (as Legend): 1984 (Beijing) • Headquarters: Morrisvill, NC (USA) • Products: PC, Notebook, Tablet, … • Revenue (2016): $43 billion • Employees: 52, 000 • Operations: 60+ countries • Sales: 160 countries • In 2013, Lenovo was the World’s largest PC vendor by unit sales. • Lenovo acquired IBM’s Personal computer business in 2005 for $1. 8 billion; instantly became the world’s 3 rd largest computer maker. • Entered the smartphone market in 2012; the largest vendor in China. • Acquired the mobile phone maker Motorola Mobility from Google in 2014. • Lenovo's official language: English http: //en. wikipedia. org/wiki/Lenovo

Acquisitions: Quick Access to Technology • Microsoft acquires Nokia's devices and services unit and

Acquisitions: Quick Access to Technology • Microsoft acquires Nokia's devices and services unit and license the company's mapping services in a deal worth $7. 2 billion in a bid to bolster the company's position in the smartphone market. • The software giant will pay $5 billion for "substantially all" of Nokia's phone unit and another $2. 2 billion to license its patents.

A recent global service: Facebook Socializing globally since 2004

A recent global service: Facebook Socializing globally since 2004

A global business model: UBER (vs. TAXI): Connecting drivers with riders via Apps •

A global business model: UBER (vs. TAXI): Connecting drivers with riders via Apps • Founded: 2009 in San Francisco (USA) • Service: 60+ countries, 404 cities • Value: $62. 5 billion (2015) • Product: Apps for smartphones • Rank: 48 th Most Powerful company (2014) • Revenues (in $billions): 0. 7 b (2013), 2. 9 b (2014), 10 b (2015) https: //en. wikipedia. org/wiki/Uber_(company)

Redefining ‘Shop’ (A New Model for ‘Service’): Amazon. com: World’s Largest Shopping Center (E-commerce)

Redefining ‘Shop’ (A New Model for ‘Service’): Amazon. com: World’s Largest Shopping Center (E-commerce) • Founded: 1994 (Seattle, USA) • Products: Online retailing, Kindle, … • Revenue (2016): $136 billion • Employees: 340, 000 • Costumer Accounts: 310 million

BOSCH (Germany): Company language: English 2016: • Revenues: 73 billion Euro • Employees: 390,

BOSCH (Germany): Company language: English 2016: • Revenues: 73 billion Euro • Employees: 390, 000

Local vs. Global Thinking in Innovation: A New Product, A New Process, A New

Local vs. Global Thinking in Innovation: A New Product, A New Process, A New Business Model, A New Service

Local vs. Global Thinking in Innovation: “Science, technology & engineering; Technological goods & services

Local vs. Global Thinking in Innovation: “Science, technology & engineering; Technological goods & services have No nationality, ethnicity or religion. ”

National vs. global approach to wind turbines: Turkey vs. China Example (2007 - …)

National vs. global approach to wind turbines: Turkey vs. China Example (2007 - …) TURKEY started a ‘National Wind Turbine Project’ (MILRES) in 2007 with the goal to develop a 2. 5 MW wind turbine, using 100% native and domestic resources. CHINA purchased companies, formed cooperation with the existing wind turbine manufacturers, transferred technology and eventually produced its own turbines. Status in 2017: A 500 -k. W turbine prototype whose World leader in wind turbine manufacturing, surpassing US, future is uncertain. Germany and Netherlands.

Turkey vs. China Experience: Lessons learned • For commercially mature products, how realistic is

Turkey vs. China Experience: Lessons learned • For commercially mature products, how realistic is it to think that, globally competitive products can be develop by starting from scratch and working in a closed circuit while being limited with native brainpower and resources? • Isn’t it wiser to start one step ahead by forming international cooperation or by purchasing a company that has already developed technology and patented it? • Was it worth spending 10 years to make a prototype of the native version of a globally available existing product that improves continually in this age of knowledge economy where continuous development is the rule and shorter product life is a reality?

Global Perspective in AUTOMOTIVE

Global Perspective in AUTOMOTIVE

PROTON: National car experience of Malaysia (since 1983) • Malaysia started the Proton brand

PROTON: National car experience of Malaysia (since 1983) • Malaysia started the Proton brand "National Car Project' adventure in collaboration with Japan's Mitsubishi company in 1983. • People of Malaysia had to pay high taxes imposed on imported vehicles & parts so that Proton would succeed in the domestic market. • Despite all protectionist measures that disturbed the free market conditions, the sales of Proton plummeted, and it was unable to pay its debts to parts suppliers as of March 2016. It is trying to survive with the $500 million bailout package given by the Malaysian government. • Instead of taking a pride in their national car, today Malaysia is discussing whether Proton should be continued to be supported by the taxes paid by the people. There are negotiations to sell 50% of Proton to China. http: //www. straitstimes. com/asia/se-asia/malaysias-proton-gets-government-bailout-package-more-than-a-week-after-mahathir

Instant Presence in Worldwide Automotive Market: China Acquired VOLVO in 2010 for $1. 9

Instant Presence in Worldwide Automotive Market: China Acquired VOLVO in 2010 for $1. 9 b • By acquiring Volvo, China’s Geely got instant presence in the U. S. market as well as decades’ worth of engineering and manufacturing expertise to use in its own cars. • Geely focused on increasing Volvo sales in China, doubling them to 61, 146 by 2013. • It aims to sell 800, 000 vehicles in 2020 (200, 000 in China, 120, 000 in US, and the rest in Sweden and Europe. • Geely invests $11 billion for 3 new factories in China, U. S. marketing campaign, and SUV designed for US. 1927 Founded 1999 Purchased (car division) by FORD for 6. 45 billion USD. 2010 Purchased by Geely Automobile of China for $1. 8 b. Headquarters: Gothenburg, Sweden No. Employees: 110, 000 http: //www. bloomberg. com/bw/articles/2014 -06 -26/volvo-seeks-u-dot-sales-revival-with-return-to-swedish-roots

IEEE: 75% of Cars Will Be Autonomous By 2040 • The Institute of Electrical

IEEE: 75% of Cars Will Be Autonomous By 2040 • The Institute of Electrical and Electronics Engineers recently released predictions that autonomous cars will account for up to 75% of vehicles on the road by 2040. • IEEE went even further, forecasting how infrastructure, society and attitudes could change when self-driving cars become the norm around the middle of the century. " Source: http: //www. wired. com/autopia/20 12/09/ieee-autonomous-2040/ (18 Sep 2012)

Developing and testing technology: Driverless car technology from Google

Developing and testing technology: Driverless car technology from Google

Driverless cars as enabling technology: Pilotless aircraft (Boeing – Airbus collaboration) Advances in sensors

Driverless cars as enabling technology: Pilotless aircraft (Boeing – Airbus collaboration) Advances in sensors and AI are making the development of self-flying aircraft possible Pilotless Helicopter http: //www. pantagraph. com/business/investment/markets-and-stocks/move-over-driverless-cars-pilotless-planes-arecoming/article_d 28 e 0 fb 3 -c 34 e-58 c 2 -8991 -65 cceb 71 ebfa. html Aug. 31, 2017

Developing driverless systems for global markets: Intel acquires Israeli startup Mobileye for $15 billion

Developing driverless systems for global markets: Intel acquires Israeli startup Mobileye for $15 billion • Mobileye, founded in 1999, accounts for 70% of the global market for driver-assistance and anti-collision systems (supplier to over 20 vehicle manufacturers). “Investing in enabling technologies. ” • It employs 660 people and had a net income of $173 million in 2016. • Goldman Sachs revenue projections for advanced driver assistance systems and autonomous vehicles : ü $3 billion in 2015, $96 billion in 2025. • Digital mobility services for automobiles: ü $920 billion in 2016; $2. 0 trillion in 2025. • Intel already invested in 5 start-ups developing sensors, machine vision, etc. for self-driving systems (3 US, 1 JP, 1 FR). • Intel+Mobileye+BMW partnership: Introduce fully autonomous cars by 2021. http: //www. reuters. com/article/us-intel-mobileye-id. USKBN 16 K 0 ZP Mar 13, 2017

Hot pursuit in electric cars: FORD to invest $11 billion by 2022 in electric

Hot pursuit in electric cars: FORD to invest $11 billion by 2022 in electric cars • FORD will have 40 hybrid and fully electric vehicles by 2022. • Of these, 16 will be fully electric and the rest will be plug-in hybrids. • VW plans to spend $40 billion on electric cars, autonomous driving and new mobility services by the end of 2022. • The plan includes an electric Ford Focus with a 160 -km range and 30 minute battery recharge. • All new vehicle platforms will come equipped with engine- and batterypowered capabilities. (Jan. 15, 2018 https: //www. reuters. com/article/us-autoshow-detroit-ford-motor/ford-plans-11 -billion-investment-40 -electrified-vehicles-by-2022 -

Hot Pursuit in Electric Cars: Mercedes plans to sell 100, 000 EV/year in 2020

Hot Pursuit in Electric Cars: Mercedes plans to sell 100, 000 EV/year in 2020 • Daimler plans to invest over $8 billion in green technologies over the next two years alone. • As part of the plan, Mercedes-Benz will eventually electrify every single model series of its passenger vehicles. It plans a new EV with 300 -mile range. (June 13, 2016 http: //www. autoblog. com/2016/06/13/daimler-exec-promises-100000 -annual-ev-sales-2020/#slide-3827788

Samsung EV battery (2021): 600 -km range, 20 -min fast charge (9 January 2017)

Samsung EV battery (2021): 600 -km range, 20 -min fast charge (9 January 2017) https: //www. engadget. com/2017/01/09/samsung-sdi-fast-charge-car-battery/

Safer Alternative to Lithium-Ion Batteries: Solid-state design; Non-flammable electrolyte • Uses sodium rather than

Safer Alternative to Lithium-Ion Batteries: Solid-state design; Non-flammable electrolyte • Uses sodium rather than lithium. • 3 times more energy dense. • Better performance, lower cost. • Noncombustible due to the solid-state design, which replaces the flammable liquid electrolyte used in lithium-ion battery cells with a solid material (glass). • Glass-electrolyte solid-state battery can charge and discharge faster and will have a longer lifespan than current lithium-ion designs. • Developed by John Goodenough from the University of Texas Austin, the co-inventor of the lithium-ion cell. (March 4, 2017 http: //www. csmonitor. com/Business/In-Gear/2017/0304/Inventor-of-lithium-ion-battery-introduces-safer-faster-charging-alternative

Extending the Life of Lithium-ion batteries to infinity • Brittleness is solved by coating

Extending the Life of Lithium-ion batteries to infinity • Brittleness is solved by coating a gold nanowire in a Mn. O 2 shell and encasing it in an electrolyte made of a plexiglas-like gel. • The combination is reliable and resistant to failure, lasting 100, 000+ cycles instead of just 5000 without losing any capacity. • (22 April 2016) http: //www. computerworld. com/article/3060005/mobile-wireless/scientists-can-now-make-lithium-ion-batteries-last-a-lifetime. html

Wireless electric vehicle charging (WEVC): Charging while driving at highway speeds • Qualcomm Inc

Wireless electric vehicle charging (WEVC): Charging while driving at highway speeds • Qualcomm Inc (chip maker for cell phones) demonstrated how electric vehicles could be charged wirelessly while driving. • Embedded pads in the road on a test track in France transferred 20 k. W of charge to the cars' batteries at over 100 km/h speeds. (18 May 2017) https: //www. qualcomm. com/news/onq/2017/05/18/wireless-dynamic-ev-charging-evolution-qualcomm-halo

Global Cooperation: BMW, Toyota Partner On Next-Generation Batteries http: //www. foxnews. com/leisure/2013/01/24/bmw-andtoyota-team-up-on-sports-cars-battery-development/ January 24,

Global Cooperation: BMW, Toyota Partner On Next-Generation Batteries http: //www. foxnews. com/leisure/2013/01/24/bmw-andtoyota-team-up-on-sports-cars-battery-development/ January 24, 2013 • Toyota Motor Corp. and BMW Group are working together on nextgeneration batteries for green vehicles called 'lithium-air. ’

Global Cooperation: BMW – Solid Power to develop solid-state batteries • Higher energy density

Global Cooperation: BMW – Solid Power to develop solid-state batteries • Higher energy density • Better safety • Longer battery life (vs. lithium-ion) Solid Power: University of Colorado, Boulder Spinoff https: //www. yahoo. com/news/bmw-teams-solid-power-develop-123555612. html, Dec. 18, 2017

Hydrogen Cars: Joint R&D by Ford, Daimler, Nissan January 28, 2013 http: //www. sfgate.

Hydrogen Cars: Joint R&D by Ford, Daimler, Nissan January 28, 2013 http: //www. sfgate. com/business/energy/article/ Ford-Daimler-Nissan-to-research-hydrogencars-4228722. php Ford is joining with Daimler and Renault-Nissan to speed development of cars that run on hydrogen, with hopes of bringing a vehicle to market in 4 years. • Each company will invest equally in the technology. The companies will use the common fuel cell system developed to power their own vehicles. • Ford: "Working together will significantly help speed this technology to market at a more affordable cost to our customers. " • "We will all benefit from this relationship, as the resulting solution will be better than any one company working alone. "

 Football: Best example for ‘No national boundaries’ UBTYS 2011 -2016 Stratejik Çerçeve

Football: Best example for ‘No national boundaries’ UBTYS 2011 -2016 Stratejik Çerçeve

Global Perspective in AVIATION

Global Perspective in AVIATION

Canada’s Commercial Aircraft Experience: Bombardier – Starting by purchasing 3 firms • Bombardier Aerospace

Canada’s Commercial Aircraft Experience: Bombardier – Starting by purchasing 3 firms • Bombardier Aerospace company, with 34, 000 employees and 2014 revenues of $10. 5 billion in 2014 is the 3 rd largest airplane manufacturer after Boeing and Airbus. • Bombardier entered the aircraft manufacturing sector in 1989 by purchasing bankrupt Northern Ireland's Short Brothers aircraft manufacturing company and bankrupt Learjet which produced business jets in Kansas in US in 1990. • In 1992 it purchased de Havilland Aircraft of Canada, which was the Toronto Unit of Boeing. • With these strategic purchases, Bombardier became a world brand in the aviation sector in a short time with already certified wide-ranging products, patents, skilled manpower, brand recognition, production plants and sales network. https: //en. wikipedia. org/wiki/Bombardier_Aerospace

Brazil’s Commercial Aircraft Experience: Embraer • Brazil's Embraer company, which is in tight competition

Brazil’s Commercial Aircraft Experience: Embraer • Brazil's Embraer company, which is in tight competition with Canada's Bombardier company in the medium size regional aircraft market, was founded in 1969 by the Brazilian government. • The company that was privatized in 1994 employs 19 thousand people. • The total revenues of Embraer, which also sells aircraft parts and provides ground services, was $6. 2 billion in 2013. The Embraer-based aviation manufacturing sector of Brazil has a wide range of products, and its revenues reached $7 billion in 2013. • 70% of the parts used in Embraer regional aircraft are of the US origin. https: //en. wikipedia. org/wiki/Embraer; http: //trade. gov/topmarkets/pdf/Aircraft_Parts_Top_Markets_Report. pdf

Honda. Jet: Japan’s Entry into Aviation in the US • The Development of Honda.

Honda. Jet: Japan’s Entry into Aviation in the US • The Development of Honda. Jet started 30 years ago by the Japan-based Honda. Received production certification from FAA in 2016. • Honda. Jet stands out as the fastest, quietest and most fuel-efficient in the small-cabin business jet class. • $6 billion market for business jets. • 60% of the demand for this type of aircraft comes from the US and Canada. Honda Aviation Company was is founded in the US, not in Japan, due to the strategic advantage provided by being close to the market. • The business jet can seat up to 7 people and lists for about $4. 5 million. Honda already received 100+ orders, primarily from customers in North America and Europe. • Competition: U. S. -based Cessna, Embraer of Brazil, and others. http: //www. startribune. com/faa-approval-near-honda-s-business-jet-about-to-hit-market/360967031/

Personal Aircraft by a French-born Founder: Silicon Valley’s New Private Plane for $595, 000

Personal Aircraft by a French-born Founder: Silicon Valley’s New Private Plane for $595, 000 • The plane has a cruising range of 1, 050 miles and a price tag of $595, 000. • $50 million in pre-orders were acquired in just 90 days following the aircraft’s launch on November 12, 2015. • Among buyers: Silicon Valley entrepreneurs from both Google and Apple were among the first to order, as well as top-level executives from Canada, the United Kingdom, Germany, and around the globe. Feb 16, 2016 https: //www. yahoo. com/autos/silicon-valley-private-jet-choice-just-secured-50 -200031518. html

Globalization in Aviation: Imported parts; manufacturing facilities abroad • Out of the total 5,

Globalization in Aviation: Imported parts; manufacturing facilities abroad • Out of the total 5, 300 aircraft the European-based Airbus Company sold to the whole world, it sold 2000 aircraft to North America. • Taking into consideration the size of the market, Airbus established a factory with an annual production capacity of 50 aircraft with an investment of $600 million in Alabama, USA. • The ratio of the US origin parts in Airbus aircraft is 40% (in some models of A 380 models with a capacity of 530 passengers, it is 51%). That ratio is 53% in Canada's Bombardier C-Series aircraft, 70% in Embraer. • It seems that the ratio of the domestic parts in the aircraft that are a source of pride for those countries is a small fraction. • But not much attention is paid to this ratio, and the aircraft manufacturers view the number of supplying companies and their global diversity as a 'wealth of resource'. https: //en. wikipedia. org/wiki/Airbus; https: //en. wikipedia. org/wiki/Boeing

BOEING 787 Dreamliner: 2. 3 million parts; 5400 suppliers • Boeing works with 5,

BOEING 787 Dreamliner: 2. 3 million parts; 5400 suppliers • Boeing works with 5, 400 suppliers for commercial aircraft and buys 750 million parts from them annually. • Boeing 787 having 2. 3 million parts, shows the importance of having a broad domestic and foreign supplier chain. • The competition among parts suppliers feeds innovation, and enables the aircraft manufacturers to obtain higher quality innovative products at lower costs. Thus, a significant proportion of R&D costs and risks are undertaken by the parts manufacturers. This enables the aircraft companies to focus on integration of competitive products. http: //www. boeingblogs. com/randy/archives/2013/02/supply_chain. html

CLOSING

CLOSING

Conclusions – 1/3 • Self-sufficiency is a utopia for a country and insistence on

Conclusions – 1/3 • Self-sufficiency is a utopia for a country and insistence on this dream brings about inefficiency, poor quality, decline in competitiveness, and impoverishment. Even the USA is dependent on other countries to sell products/services. • A product that cannot be competitive in the global market with its price and quality, cannot remain competitive in the domestic market either, and it will disappear from the market in time. Therefore, the attempt to manufacture all products domestically will result in surrendering the market to foreign products. • Imposing high tariff walls to support domestic production and thus to force people to buy domestic goods is to doom people to highcost and low-quality products and to rid the higher standard of living. • A country should determine the areas/products/services for which it can be competitive in the global arena after a careful analysis, and focus its activities in those areas. Those who try to do everything cannot do anything economically, and cannot become competitive in anything.

Conclusions – 2/3 • R&D is a global phenomenon. An R&D program that is

Conclusions – 2/3 • R&D is a global phenomenon. An R&D program that is not sustainable and competitive at a global scale is like no R&D since a technology that is not on par cannot develop competitive products or services. Even if it did, it cannot sustain them. • Science, technology and technological goods/services have no nationality. For a country to isolate itself from the world to develop competitive 'fully native and original technology' is simply to lose contact from reality, which will result in a waste of time and resources. It is important to be output-based rather than input-based. • Alternative innovation approaches like buying companies instead of developing a product from the scratch, taking part in international cooperation and even opening R&D centers in foreign countries have become necessary to maintain the competitive edge in the globalized world.

Conclusions – 3/3 • There is no such thing as 100% domestic parts in

Conclusions – 3/3 • There is no such thing as 100% domestic parts in products in the globalized world. To force manufacturers to use a minimum certain percentage of domestic parts in a product is to inflict a heavy blow to the global competitiveness of that product and to impair its marketability. • Job creation and developing/manufacturing high-technology products should not be mixed with each other and should not be put into the same basket. Domestic and foreign companies can be persuaded to build manufacturing facilities in a country and create jobs by making manufacturing attractive in that country. • The most domestic or national product of a country is one that is made by a company belonging to that country and provides the highest benefit to the people of that country regardless of the ratio of the domestic parts used and the country in which it is developed or manufactured.

Q: What is the ‘most domestic’ product/firm? The most domestic product/firm is one that

Q: What is the ‘most domestic’ product/firm? The most domestic product/firm is one that provides the most benefits to the citizens, regardless of the % of domestic parts used and the country of manufacturing or development. BENEFITS PROVIDED: • Increase in GDP per capita, • Job creation, • Skills (know-how) accumulation, • Derivative product potential, • Establishment of a powerful information ecosystem and innovation chain, • Reducing foreign dependence on critical technologies • Full control over products & ability to use them w/o imposed restrictions • Secrecy and national security, • High prestige and high moral due to technological advances and leadership • Strengthening national pride, increasing sense of belonging • Foreign currency input & better current account balance, etc.

Thank You …

Thank You …