Foxconn Raising Prices on Apple?

Discussion in ' News Discussion' started by MacRumors, Oct 12, 2010.

  1. MacRumors macrumors bot


    Apr 12, 2001


    Reuters briefly reports on a note from Citibank analyst Chang Kaiwei claiming that Apple manufacturing partner Foxconn and its parent company Hon Hai are preparing to raise the prices they charge to their customers for manufacturing devices such as the iPhone.
    The move, said to be designed to boost quarterly profits for the firms, is also said to affect Nokia, Microsoft, and Sony Ericsson.

    It is unclear how much of a price increase Hon Hai is targeting, and thus whether Apple will be able to maintain its existing pricing for its customers or if it will be forced to pass along some of the increase. Apple will presumably make every effort to maintain its current price points, and its healthy gross margins should offer the company some flexibility in this regard, although any change in Apple's cost situation would likely have an effect on Apple's forward-looking financial guidance and investor sentiment.

    Article Link: Foxconn Raising Prices on Apple?
  2. Theclamshell macrumors 68030

    Mar 2, 2009
    The new Macbook Pro. Only $25,000

    But seriously, i hope this does not result in a major price hike form apple :/
  3. alphaod macrumors Core


    Feb 9, 2008
    So Apple will simply switch manufacturers?

    Or if they do raise the prices and Apple sticks with them hopefully they increase the worker's wages, and manufacture higher quality goods.

    And what's with the excess amount of non-Chinese people in their image. :confused:
  4. flopticalcube macrumors G4


    Sep 7, 2006
    In the velcro closure of America's Hat
    The only thing I think apple will get out of this is price increases. I don't see anything else changing. It's been a long time in coming, IMO.
  5. Brinkman macrumors 6502


    Jul 26, 2010
    Probably never going to happen but I'd love to see the day apple products were made in the states.
  6. mobi macrumors 6502


    Jul 26, 2004
    Penn's Woods
  7. Warbrain macrumors 603


    Jun 28, 2004
    Chicago, IL
    I hope you don't mind paying the price of a ****** car for a top-notch computer.
  8. Dillenger macrumors 6502a


    Mar 23, 2006
    Central, Illinois
    Ching, Ching, why not cash in on the good fortune of great sales. It's the American, Ahhh Chinese way.
  9. WiiDSmoker macrumors 65816


    Sep 15, 2009
    Hermitage, TN
    The price of an iPhone would at minimum quadruple.
  10. X38 macrumors 6502

    Jul 11, 2007
    With $40B cash on hand and the second highest stock valuation in the world, Apple is well positioned to pull manufacturing back in-house and should do so sooner rather than later. Outsourcing is a damn fool idea that worked only as long as countries like China artificially manipulated currency exchange rates. Problem is, the exchange rate manipulations have gone as far as they can and have pushed trade imbalances to preposterous levels that can not be sustained. Huge corrections in exchange rates are inevitable and will only get more severe the more governments try to resist the natural economic pressures on the rates. It will be a time of turmoil and massive cost inflation for those who depend on supposedly 'low-cost' manufacturing countries. Those companies who figure it out and start 'in-sourcing' their manufacturing before the house of cards falls apart are the ones who will survive the chaos.
    Apple is probably better positioned than anyone to do so, if they are smart enough to see it coming.
  11. VelfarreClubber macrumors member

    Jun 26, 2008
    Fullerton, CA
    That is one funny picture. What are they all smiling at?:D
  12. rp2011 macrumors 65816


    Oct 12, 2010
    I think it's about time a US electronics company took the effort to built a state of the art manufacturing facility here in the us. Figured out how to automate the stuff we hire cheap manual labor for. Why should China have all the suicides and toxic waste.
  13. acurafan macrumors 6502a

    Sep 16, 2008
    right, to pay for my already overpriced laptop only made by United Apple Workers union who drinks and smoke pot during lunch.

    ives opens his newly minted liquid metal MBA smelling like a friggin bottle Colt 45 or it came with a 'special' piece of hash...left by our proud UAW worker, nice.
  14. Adisah macrumors regular

    May 29, 2008
    Made in USA.

    What they need to make is facilities that are fully automatic. No workers. Just a handful of experts over seeing things. Or have a lot less workers due to more automation.
  15. Lucky736 macrumors 6502a


    Jan 18, 2004
    Two things:

    One, these costs are done over large time periods. They are contracted. They won't be assumed until future contracts.

    Two, Apple owns probably the most advanced electronics "factory," if that is the proper word, the world has ever seen in CA. They would just make essentially a bigger one.
  16. IBradMac macrumors 68000


    Jun 27, 2008
    Have to be diverse these days...don't want to piss anyone off.:rolleyes:
  17. Full of Win macrumors 68030

    Full of Win

    Nov 22, 2007
    Ask Apple
    The NT is trading in the mid 30's (between 30.0 to 31.0) relative to the USD. It was a few NT's per dollar higher in the past. Since Foxconn (not their name in TW) gets profits in NT's, they have to raise prices.

  18. rp2011 macrumors 65816


    Oct 12, 2010
    Anyway, I am sure Apple has already looked at the viability of some kind of automated state of the art facility from every direction and angle. If it becomes feasible it will happen. It's not like they are too cash strapped to make it happen if they wanted to.
  19. alexbates macrumors 65816


    Nov 24, 2008
    Georgia, USA
    Why would Apple have to raise their prices? If the iPad cost $15 to manufacture because of this, up from $10, Apple wouldn't sell the iPad for $504... :p

    I hope this happens, and the wages of workers are increased. They deserve more money for the amount of work they do each day.
  20. wegotmac macrumors newbie

    Apr 29, 2010
    Made in the USA

    The sad story is once upon a time Apple products used to be made in the USA. It'd be great to it come back though
  21. majordude macrumors 68020


    Apr 28, 2007

    First, America outsourced to Japan. They became rich. Then we went to Korea. They became rich. Then we went to Mexico. They became rich. Then we went to China. They became rich.

    Each time we gave away manufacturing jobs and technology.

    We became poorer.

    Soon the world will outsource to us and we will be thankful for manufacturing TVs, computers and sex robots for the Chinese, Japanese, Koreans and Mexicans.

    You are zigging when you should be zagging. Humans are the cheapest robots known to man. They are readily available, infinitely replaceable and can easily be manufactured (for free) with unskilled labor.
  22. Shookster macrumors regular

    Feb 16, 2009
    No pay rise for the workers, it would seem. I honestly wouldn't mind paying $30-40 more for a device that already costs hundreds (or thousands) of dollars if it means the person making it gets a decent salary.
  23. nagromme macrumors G5


    May 2, 2002
    Well, except for the guy in the very corner, whose grim expression seems to say, “those aren’t just flying bunnies... those are flying bunnies with machine guns!”
  24. Brinkman macrumors 6502


    Jul 26, 2010
  25. DTphonehome macrumors 68000

    Apr 4, 2003
    Look, everyone was complaining about poor treatment of employees by Foxconn, so they raised salaries, relocated many employees to be closer to their families, etc. All these moves cost money. Foxconn wasn't interested in spending it until the media started howling that the people who make the most popular electronics in the world are committing suicide en masse (sarcasm). So, now we've all got to pony up the additional few bucks per item. Personally, I think it's well worth it... the reason we get this stuff so cheap is because China's labor standards are not up to the same level as the US and Europe. But if enough people demand that Western-style labor practices are established in China, the price differential between Asian and Western manufacturing will decrease. This will raise the standard of living for Chinese, and possibly bring some manufacturing back to the West as the cost benefit of outsourcing is reduced.

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