Interesting points. Here are some possible counterarguments.
1) Ultimately, I suspect that having a production infrastructure that is "right-sized" relative to demand and allows for flexible scheduling is pretty critical to being able to sustain production profitably. Based on what several posters with specialized knowledge have posted - this hard to execute. Lucky Film has pretty substantial capacity.
2) There's an accute labor shortage in China and the government does still, to an extent, exert some influence as to where workers end up. I don't think analog photography is of great strategic value...
3) Wages are rising rather quicly in China
Here's an interesting article regarding 2 and 3:
ere's an interesting article:
http://www.nytimes.com/2006/04/03/b...=49c0d472886e1f39&ei=5088&partner=rssnyt&emc=
4) There are raw material shortages in China and the relative weakness of the currency makes these expensive. And silver prices, for one, are going through the roof...
Honestly, I'm not sure the UK isn't better suited for this stuff - at least for the moment. The economy is strong, but there isn't really a labor shortage and wage growth is contained, the currency is strong, and the company has manged to survive at least a couple downsizing efforts.
I'm hopeful that film production will remain viable in several parts of the world...