- China: USD 15 – 75 / h
- Eastern Europe: USD 35 – 90 / h
- Western Europe & USA: USD 65 – 200 / h
- 50 – 70 % of the total part cost is still “time”, so a 1 h difference in cycle-time outweighs a 20 $/h difference in labour.
- The cheapest machine is the one that is never re-cut.
1. How the Hourly Rate is Built Up
Wherever you quote, the formula is the same:Hourly Rate = (equipment depreciation + energy + tooling + labour + overhead) ÷ estimated spindle hours/yearTable
| Cost bucket | China % | WEur % |
|---|---|---|
| Machine depreciation | 35–45 | 30–40 |
| Labour & programming | 15–25 | 35–45 |
| Cutting tools / coolant | 8–12 | 8–12 |
| Energy / factory overhead | 15–20 | 15–20 |
| Margin | 10–15 | 10–15 |
Labour is the only line that scales heavily with geography; everything else is surprisingly global because Haas, Mazak, Sandvik and Blaser charge the same price in Budapest and Birmingham.
2. Real 2025 Numbers on the Street
(median shop, 3-axis vertical, no automation)Table
| Region | Typical shop rate | 5-axis premium |
|---|---|---|
| Suzhou / Shenzhen | 18 – 25 $/h | + 15 – 20 $/h |
| Wroclaw / Budapest | 40 – 55 $/h | + 25 – 35 $/h |
| Stuttgart / Lyon | 80 – 110 $/h | + 40 – 70 $/h |
| Midwest USA | 85 – 120 $/h | + 50 – 80 $/h |
A medical implant that needs 4 h in a 5-axis machine costs ~ 140 inChina, 260 in Poland, ~ 480 $ in Germany—before material, heat-treat or QC.
But a 10 % re-machining rate in China immediately eats the labour advantage.
3. Why the “Chinese Discount” is Smaller Than It Used to Be
- Wage inflation: Chinese CNC operators have seen 6–8 % annual raises for five straight years .
- Tooling & energy: 100 % imported carbide and 0.09 $/kWh industrial electricity are now on par with Eastern Europe.
- Currency: RMB has appreciated ~ 9 % vs USD since 2020.
- Compliance: ISO 13485, IATF 16949 and carbon-footprint audits add 3–5 $/h of overhead that did not exist in 2015.
Net effect: The China–Germany gap narrowed from 4:1 in 2010 to roughly 2.2:1 in 2025
.
4. Hidden Cost Drivers That Erase the Hourly Gap
| Factor | Impact | Where it hurts |
|---|---|---|
| Programming re-work | + 0.5–2 h / part | Complex 5-axis |
| High scrap / re-cut | + 20–40 % cycle | Tight tolerances |
| Long supply chain | + 2–4 weeks | JIT penalties |
| Import duty & VAT | + 15–25 % | EU anti-circumvention |
| Travel / QC audits | + 0.50 $/pc | Aerospace lots |
A German shop that runs unattended 3rd shift at 65 /hcaneasilybeataChineseshopat25 /h if the Chinese scrap rate is > 5 %.
5. When Does Europe Actually Win?
- Lot size < 200 pcs – set-up dominates, labour gap irrelevant.
- Tolerance ≤ ±5 µm or Ra ≤ 0.4 µm – local re-work is cheaper than air-freight.
- DFM iterations needed – same time-zone cuts 2–3 days per loop.
- Carbon surcharge incoming – EU CBAM could add ~ 1.5 $/kg steel equivalent in 2026.
6. Cheat-Sheet: How to Choose the Right Continent
| Part weight | Annual vol | Geo-rationale |
|---|---|---|
| < 0.5 kg | 5 k – 50 k | China (automated 3-axis) |
| 0.5 – 5 kg | 500 – 5 k | Eastern Europe (fast freight) |
| > 5 kg / high mix | < 500 | Western Europe (no import duty, same-day DFM) |
7. Take-Away for Buyers
- Quote cycle time, not hourly rate. A 5-axis job that is 45 min faster in Europe can be cheaper even at 3 × the shop rate.
- Audit scrap and FAI data, not just ISO certificates.
- Lock currency & freight 6 months ahead; they now swing more than labour.
- Consider total landed cost + risk cost; the cheapest machine is the one you never have re-machine.
Bottom line: China is still cost-competitive, but the margin is thin and shrinking. The real savings today come from design-for-machining, lights-out automation and supply-chain agility—not from the flag on the invoice.
We are a Chinese leading company in the manufacture of tooling, stamping, injection molding, CNC machined parts. For any inquiries, reach out to us directly. We’re here to assist you.
