Apple Asks U.S. for Import Tariff Exemption on Parts for New Mac Pro After Shifting Assembly to China

[az431]

Sorry, they chose to move the production to China, they had already been assembling it in the U.S. previously, which shows that it CAN be done.

Now there could be an argument that the parts can only be purchased from China and thus should be exempt from import tariffs, but the fully assembled machines should absolutely be subject to the import tariffs.

As for the proprietary, Apple designed component, well it is proprietary and designed by Apple, which means they could literally take it anywhere that manufactures electronics (say Samsung in Korea even) and have them manufacture it, sorry, I don't buy into that argument, Apple owns the design, so they can do what they want, but they choose to get it from China, so yes, they should be subject to the tariffs as well.

Good thing it’s not up to you “buy the argument” because your analysis is devoid of any reasoning and is based on incorrect facts. Based on your flawed reasoning everything should be made in the US since it “can be done,” without regard for whether it is profitable.

You are wrong. It cannot be done in the US. There is not enough skilled labor, and the fact that Apple built the low volume trash can Mac here doesn’t change that fundamental and correct fact that you conveniently ignore.

And even if it could be done, Apple is a business so obviously profit matters. You can’t seriously think that a Mac Pro could be manufactured in the US for the same price as in China.

 

[pallymore]

Good thing it’s not up to you “buy the argument” because your analysis is devoid of any reasoning and is based on incorrect facts. Based on your flawed reasoning everything should be made in the US since it “can be done,” without regard for whether it is profitable.

You are wrong. It cannot be done in the US. There is not enough skilled labor, and the fact that Apple built the low volume trash can Mac here doesn’t change that fundamental and correct fact that you conveniently ignore.

And even if it could be done, Apple is a business so obviously profit matters. You can’t seriously think that a Mac Pro could be manufactured in the US for the same price as in China.

I'm pretty sure almost everything can be done in the US. But Tim is responsible for making money for the stakeholders. If they can make more money by producing stuff in China then they will do it (otherwise their stockholders will just take their money elsewhere). And, hey, they don't have to worry about unions and welfare across the Pacific. *wink*

Not saying this is good though.
It seems some people want to be pro-capitalism and demanding companies to handout their monies at the same time.

 

[MR.Raul]

The people that complain that Apple should pay the Tariff, are the same people that complain about the hefty pricing of the their products.

Choose 1...

 

[vailr]

I believe there may be tax advantages by having the final assembly work performed on U.S. soil. Apple could save on import duty money by simply doing the same type of final product assembly (& operating system installation) in their current Texas Mac Pro location as is also currently done in the U.S. by HP or Dell. HP assembly locations use some 30% on-site personnel that are actually Foxconn employees.
At least, that's how the import duties used to work, about 12 years ago: 10% import tax for PC parts, vs. 25% import tax for China-assembled PC's. Even China-made laptops were imported with blank hard drives, and the operating system installed while on U.S. soil.

 

[Saipher]

Somehow Japan is not “past manufacturing” and it’s not a “developing third world country”.

All of that has nothing to do with the point that Japan is not “past manufacturing” and it’s not a developing third world country.

I never said all developed countries are past manufacturing, I said America is past manufacturing, and moving manufacturing to developing countries where wages are cheaper makes business sense.

 

[Vidd]

Apple indicates that "there are no other sources for this proprietary, Apple-designed component."

Presumably there are no other sources of these magical components because they don't want to pay any American company to make them.

 

[Compile 'em all]

Sorry, they chose to move the production to China, they had already been assembling it in the U.S. previously, which shows that it CAN be done.

Now there could be an argument that the parts can only be purchased from China and thus should be exempt from import tariffs, but the fully assembled machines should absolutely be subject to the import tariffs.

As for the proprietary, Apple designed component, well it is proprietary and designed by Apple, which means they could literally take it anywhere that manufactures electronics (say Samsung in Korea even) and have them manufacture it, sorry, I don't buy into that argument, Apple owns the design, so they can do what they want, but they choose to get it from China, so yes, they should be subject to the tariffs as well.

You ready to shell out even more money for Apple products? All of these keyboard warriors over here would be filling the forums with posts if Apple hiked the prices in the United States by 25%

 

[C00rDiNaT0r]

Presumably there are no other sources of these magical components because they don't want to pay any American company to make them.

Sure, go ahead and acquire land in whichever state that has a very robust shipping/delivery network (highways, railroads, etc.), build a new factory from scratch (and obtain the proper construction permits), identify contractors that can build and deliver on time despite inclement weather, acquire hundreds of million dollars worth of specialized tooling so that you can fulfill global demand, and lastly, skilled and qualified workers who are capable and willing to work all year round, including weekends and holidays.

How long will all this take, and how much do you think it will all cost Apple? Will they ever sell enough Mac Pro's to even offset these costs throughout the lifetime of this particular design iteration?

 

[Nati-Yolie]

The people that complain that Apple should pay the Tariff, are the same people that complain about the hefty pricing of the their products.

Choose 1...

You don’t have to choose 1 when you see what the tech specs are at the prices they’re asking for. They have huge margins. They can afford to let us choose both.

 

[Mactendo]

Japan has had a stagnant economy for two decades and has serious demographic issues. It is the most indebted country, as percent of GDP, by a long shot.

Japan had an early start on cell phones, then Apple and Google came in and completely took over. Their world leadership position in electronics, particularly RAM, flash, and displays, all fell and their core businesses there are now owned by Korea or the US. Japan never had a serious player on the Internet.

Japan is an example of what can go wrong.

Japan had an early start on a lot of things. 2 out of 3 existing worldwide gaming platforms are still from Japan: Sony PlayStation and Nintendo. 2 out of 2 most popular DSLR manufacturers are Japanese: Canon and Nikon. It has automotive industry with the world’s best selling cars. Not to mention a bunch of other electronics companies like Panasonic.
Not everything fell and was sold.

Speaking about demographics and other stuff I’d say US is an example of what can go wrong with its intentional homicide rate 25 times higher than in Japan. Also Japanese have the highest life expectancy in the world.
Many countries would die to be such example of ‘wrong’ as Japan. So it depends on the definition of what is considered wrong here.

 

[C00rDiNaT0r]

You don’t have to choose 1 when you see what the tech specs are at the prices they’re asking for. They have huge margins. They can afford to let us choose both.

Why do you assume the "huge margins" are enough to offset tooling, labor, and other costs? Currency fluctuations? Yield rates?

 

[konqerror]

2 out of 3 existing worldwide gaming platforms are still from Japan: Sony PlayStation and Nintendo.

A perfect example of failing to adapt. Nintendo's struggles against mobile gaming, again the iPhone and Android, are well known. Console gaming is playing second fiddle to gaming on Microsoft, Intel and Nvidia, to the point that this and next generation of Playstation and Xbox are PCs. Fine for Microsoft, since their product pushes their Windows platform, but that leaves Sony hanging. Note too that consoles are heavily restricted in the world's largest market, China, so their gaming is PC based.

Speaking about demographics and other stuff I’d say US is an example of what can go wrong with its intentional homicide rate 25 times higher than in Japan. Also Japanese have the highest life expectancy in the world.

Japan has the highest suicide rate. Also, Japan's justice system is laughable: you're guilty. Japan trains people to work as robots. The strict conformity is a large reason why they fail in a knowledge economy, and why they get into regular coverups and scandals. (Multiple nuclear issues ending with Fukushima, Olympus financial fraud, Takata's airbags and their joint coverup with Honda, Toyota accelerator pedals, Kobelco's decades of substandard steel, Nissan and Subaru's forged inspections, Mitsubishi's recall coverups...)

 

[mikethemartian]

Lol so all these companies are just going to get special passes anyway for their manufacturing in China? Why even pursue the tariffs in the first place then? Seems like this is more for show than actually implementing anything of substance, but then again that's all this "administration" has done from the beginning

Tariffs and regulations allow those in power to give special interest groups they favor benefits at the expense of all other groups. As opposed to a free market where all participants have to deal with the same market forces without special favors from the government.

 

[ThatGuyInLa]

How about this? Build them in the USA and then you’ll get a waiver.

 

[thisisnotmyname]

Good thing it’s not up to you “buy the argument” because your analysis is devoid of any reasoning and is based on incorrect facts. Based on your flawed reasoning everything should be made in the US since it “can be done,” without regard for whether it is profitable.

You are wrong. It cannot be done in the US. There is not enough skilled labor, and the fact that Apple built the low volume trash can Mac here doesn’t change that fundamental and correct fact that you conveniently ignore.

And even if it could be done, Apple is a business so obviously profit matters. You can’t seriously think that a Mac Pro could be manufactured in the US for the same price as in China.

Wait, what? You really don't think Flex has the manufacturing capacity to build the 2019 Mac Pro in the US?? That's just flat out incorrect.

 

[mikethemartian]

How about this? Build them in the USA and then you’ll get a waiver.

That doesn’t benefit the end purchaser. The price is going to go up the same amount. The only difference is who gets the extra cash out of your pocket.

 

[Cole Slaw]

The U.S. government really should give Apple a waiver.
This poor company can barely make ends meet. Even its CEO is forced to thumb a ride to work.
Please, Mr. Trump, think of the children.

 

[thisisnotmyname]

You ready to shell out even more money for Apple products? All of these keyboard warriors over here would be filling the forums with posts if Apple hiked the prices in the United States by 25%

That's not how tariffs work.

First of all the actual impact of tariffs would be dependent on exchange rates and China has a history of manipulating their currency (less so in recent years as they've had some reforms). CNY has rebounded recently but earlier this year was off 10% for 2019 which would have an immediate affect on the tariffs (i.e. buy your goods at a lower effective price but with a tariff added and they offset each other to an extent). Incidentally this is why the tariffs went from 10% as originally enacted to 25% - CNY fell against the dollar roughly 10% effectively negating the effects of the tariffs altogether.

Secondly, the tariff is on the declared cost of the good being brought into the US, not the price it will be sold for at retail. Although none of us outside the C-suite at Apple know what Apple's true cost is for their hardware we've all seen various estimates and they are well below retail. The tariff would also not be levied against US based costs such as the development of iOS, just the DCOG of items with Chinese country of origin.

So let's say Apple is spending $250 (to keep a nice round number and inline with estimates we've seen before) for an iPhone from China, with 10% decline in CNY and 25% tariff that's about $31. If Apple passes that full burden on to the end customer in the USA that's a far cry from a 25% increase in the price of an iPhone to an end user.

 

[-BigMac-]

The people that complain that Apple should pay the Tariff, are the same people that complain about the hefty pricing of the their products.

Choose 1...

Yea thing is, Apple took the tarriff prices into account when announcing the pricing for their product, and now want to decrease the production costs thereafter.

Did it say anywhere that Apple will decrease their pricing if the Tarriff reduction goes through?

Nope. Just higher margins

 

[Porco]

It must be annoying to wait for ages for something and then find out it’s going to cost lots more money that it previously did, huh Apple?

 

[turbineseaplane]

It must be annoying to wait for ages for something and then find out it’s going to cost lots more money that it previously did, huh Apple?

lmao
Nicely done..
[doublepost=1563924515][/doublepost]

Nope. Just higher margins

Bean Counter Tim's only real legacy

 

[developer13245]

So much for keeping their promise of moving manufacturing to the USA.

 

[Mactendo]

A perfect example of failing to adapt.

Mobile gaming and consoles are two different markets.

Japan has the highest suicide rate.

By various sources Japan is somewhere like 20th in the world by suicide rate. World Health Organization says Japan was 40th in 2016 (male suicides) and 25th for female suicides. US by the same source was holding 38 and 40 places respectively.

Japan trains people to work as robots.

No comments.

why they get into regular coverups and scandals.

Just like US and many other countries.

 

[handheldgames]

So much for keeping their promise of moving manufacturing to the USA.

Hmmm. A tariff exemption for Tim Apple?

 

[Brandhouse]

Sorry, they chose to move the production to China, they had already been assembling it in the U.S. previously, which shows that it CAN be done.

Now there could be an argument that the parts can only be purchased from China and thus should be exempt from import tariffs, but the fully assembled machines should absolutely be subject to the import tariffs.

As for the proprietary, Apple designed component, well it is proprietary and designed by Apple, which means they could literally take it anywhere that manufactures electronics (say Samsung in Korea even) and have them manufacture it, sorry, I don't buy into that argument, Apple owns the design, so they can do what they want, but they choose to get it from China, so yes, they should be subject to the tariffs as well.

So you'll be part of the assembly line, just so you can bring production back to the US, making much less than you lot do with your horrible hourly rates in the US? That's what you'd need to do to compete, if not the price point of products would have to sharply rise.
[doublepost=1563927100][/doublepost]

The people that complain that Apple should pay the Tariff, are the same people that complain about the hefty pricing of the their products.

Choose 1...

And they did, it seems they're the ones who chose Trump, but forget the effects of trade wars. But that's okay because they're taking on the world, trying to make the US great again, but don't actually realise what it is doing to the world economy and the effect it has on the dads and mums.