Apple slowly bring back manufacturing to USA

Discussion in 'Apple, Inc and Tech Industry' started by Solomani, Sep 25, 2012.

  1. Solomani macrumors 68030

    Solomani

    Joined:
    Sep 25, 2012
    Location:
    Alberto, Canado
    #1
    Recent events (FoxConn) leads me to believe that Apple currently has a window of opportunity to slowly bring back manufacturing to the USA. For one thing, they have the money to afford this moreso than their old struggling US rivals like say... DELL, IBM, HP etc.

    Apple can afford to S-L-O-W-L-Y bring manufacturing back, bit by bit, to the USA. For one thing, it cannot be done instantly overnight, as doing that means extreme disruption to their supply chain and the price of the next iProducts will double.

    Rather, they can start by bringing back small parts to be relocated to US factories. Things that can easily be made in the USA that do not require high-tech chips or fabs in Asia. Things like those Earpods (made in Vietnam now). There is no reason why American college students (as part-time jobs) or some underemployed adults cannot be trained to assemble those and package them in nice Apple retail boxes. They certainly could use the jobs!

    Also assembly is not the same as manufacturing (building actual components from glass or metal etc). The major manufacturies might be in China now. But assembly is much easier, and can be done with a less skilled work force. Assembly, you are just putting some pre-manufactured pieces together. It's not too hard to find Americans that can be trained or re-trained with assembly skills. Although tight quality control supervision is a MUST.

    Why should Apple do this, to lose profits? That's short-sighted.


    1. It will earn Apple IMMENSE respect, reputation, public relations, trust and affection, goodwill, and overall good karma within its home country. Long term, that translates into sales and profits.

    When Apple can once more put labels on their iPhones or iPods or iMacs with the label "This device was assembled in the USA" -- that is simply the single best domestic advertising possible for Apple. No other ad or commercial would be more valuable.

    Of course the only thing better is an iProduct that has the label "This Apple Product and its components were wholly manufactured and assembled in the USA." Of course, we know that's a pipe dream.

    2. For logistical reasons mentioned in recent news (i.e. avoid headaches in an unstable developing nation with unhappy explosive or exploited workforce), another reason to move back to domestic manufacturing. It shelters AAPL from such political shellout or bad publicity. It also lessens the hurt on Apple in the event that USA and China may one day choose to escalate with an aggressive military showdown or even a nasty trade war.


    Might the move hurt AAPL margins at first? It likely might, but so long as it's a small enough margin hit, then I think the company can afford to take a calculated hit given that this would be seen as a long term strategy to wean themselves away from Asian dependence.

    Hell.... I'm tempted to attend the shareholders meeting in Cupertino early next year, just so I can be a prick and bring this up to the Meeting (hopefully Tim Cook and Board listens).


    P.S. --- Reminder, thread is to discuss the feasability of bringing back Apple manufacturing/assembly to the USA. Pros and Cons. Doable or not doable. Too risky?
     
  2. thewitt macrumors 68020

    thewitt

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    Sep 13, 2011
    #2
    Not going to happen. Manufacturing costs in the US are simply too high to compete on an assembled product with locations like China.

    One Foxconn location will have over 150,000 employees. Where can you source that level of light industrial labor in he US at even twice the minimum wage.
     
  3. jeremy h macrumors 6502

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    UK
    #3
    Apple won't do it anytime soon (as thewitt) suggests. There was an interesting thing on the radio here talking about Foxconn - apparently they've got over a million employees :eek:

    However, long term well... I wouldn't be surprised. Anyone who knows anything about the Industrial Revolution where the UK became the workshop of the world in a 100 or so years (or saw the Olympics opener ;)) can't not be struck by the parallels. Talk about history repeating itself. (Demands for higher wages, attempts to organise, even down to luddites smashing up their own workplaces and 'Riots down 't mill, lad!")

    The thing is that it's on a massively fast forward. What took decades then is happening in years now. I guess China is in a race to get a balanced economy before wages rise to the point where everyone has to pack up and go elsewhere or they can be replaced by robots.
     
  4. mgartner0622 macrumors 65816

    mgartner0622

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    #4
    Exactly that. Many modern countries have seen this; USA, parts of Europe, and now India and China. It's just a repeat of what's been happing for hundreds of years. The question is, when the time comes that Chinese and Indian labour becomes too expensive, where will we turn to next? There's not many developing nations with exploitable labour left...
     
  5. Solomani thread starter macrumors 68030

    Solomani

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    #5
    The NICs? There is a short list of them after China and India.

    Philippines and Brazil have been mentioned several times. Both democracies with historically friendly relations to USA. Brazil more developed and is poised to host an Olympics in the coming years. Philippines less developed than Brazil, but many urban Filipinos speak fluent English (former American colony), so that's a bonus for a workforce. There is also Mexico, but I believe they already have been manufacturing certain Apple parts for quite some time now.

    Then again, those would not solve the original dilemma long term, because as they are still foreign nations, they could in theory backfire against American multinationals like Apple some day (kinda like China workforce is acting up now).
     
  6. thewitt macrumors 68020

    thewitt

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    #6
    The Philippines was never a colony of the US. It was an insular territory under self rule from the late 1800s to 1946 when it was granted independence.
     
  7. GoCubsGo macrumors Nehalem

    GoCubsGo

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  8. Arran macrumors 68040

    Arran

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    #8

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