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iPhone Manufacturer Foxconn Mulling $7 Billion U.S. Display Factory Investment With Apple
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I am talking if each and every component used in manufacturing iPhone is created in US. R&D cost of just $10 billion might be for R&D but that is just a part of SDLC. What about R&D costs and development costs associated with Qualcomm, Intel and other chip vendors? what about actual development costs of involved in IOS, Apple maps, iCloud lot of free pro softwares provided by Apple IOS? Please do not say that operating cost of Apple is just $10 billions per year. 590 million iPhones are global sales that number is not from US.
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Now you're just making things up. We are discussing Apple building an iPhone in the US. Not forcing Samsung to make screens in the US, not forcing TSMC to make the CPUs in the US.
And that $10 billion is everything associated to development. Employee salaries, software development, the office space their developers occupy. Hardware and software used. Prototyping machinery and supplies. Everything. And again, that is for everything Apple did in 2016, not just the iPhone.
Please read all my original comments again. I was saying that if each every component is manufactured in US it might cost $2000 or even more. Basically you are talking about Assembly but article is about display factory investment. Assembly of phone is almost automated actual jobs are associated with manufacturing components like displays which will involve substantial input costs. If you read Gou's statement over a period of time cost of iPhone will go up $500 he is just talking considering that displays are manufactured here. Complex display technologies will need skilled workforce and will cost more to employ such skilled work force.
Apple pricing of phone involves more than Apple share you will need to consider the costs associated with all the vendors.
It is simple equation for corporations 7 billion vs 300 million and for apple it is even simple to choose between 100 million(saturated) vs 490 million(potential of even bigger market).
I am happy to pay $100 more for Made is USA but $500 more is something I have to think before I spend my hard earned money. I might purchase once I will not upgrade it every year or two. I would prefer to upgrade every 4 years due to increased cost.
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We're talking about a Display Panel plant for FOXCONN customers, including Apple's iPhone/iPad systems.
Total operating cost of Apple alone is $33.5 billion $10 billion is not correct. $650 price of iPhone is reasonable if we add up shares of other vendors and their components. Please have a look at the below link it will give you a fair Idea.
http://www.wikinvest.com/stock/Apple_(AAPL)/Data/Total_Operating_Expenses
Politics aside ... isn't Foxconn rumored to begin manufacturing it's own product? Continuing to invest in a future competitor seems pretty crummy. 7B in direct investments.
That is incredibly sad.
I don't care who gets credit as long as more jobs are created so that people looking for work can find a job.
No, it's clear from what he's laid out in terms of his social policies and other metrics that he is going to do damage. His administration is already indulging in bold-face lies about things as simple as the crowds at the inauguration.
People claiming that he's going to be wildly successful and get a second term have nothing to go by. Now, don't get me wrong, I'm pretty pessimistic and think that he probably will, but I'm not going to go along with the idea that it's going to be because he's awesome.
And that's the crux of the situation - if we want more jobs in the US, there's going to be a price we'll have to pay. Literally. Something has to give and we all know it won't be a company's bottom line :/
I understand this. I suspect that the level of automation would increase if they set up production here in order to offset this. I don't think any ceo would choose to market a $2000 iphone made in the US over a $650 iphone that is made in China, assuming comparable margins. The drop in sales volume would be undesirable. They would most likely conclude that the numbers are infeasible, and it wouldn't go anywhere. This is of course assuming protectionist policies don't force directly alter the economics of it.
I don't anticipate them making everything in the US. You should note that the US does have some semiconductor manufacturing. Samsung and Intel both make some of their things here. I don't think Apple and Foxconn will attempt to build up an entire supply chain here (assuming they go through with any of this).
The actual number/s is zero, as in this is all talk and not a single dollar has been spent. When it becomes a fact then let's talk again. Tax cuts are not without problems, as seen with the Bush administration.
This has nothing to do about Trump.
Foxconn CEO is consider to get into Taiwan politics, namely trying to run the presidential campaign.
Whenever that happen, China will be pretty piss off. This to start the transition of company into US as Apple is one of their largest customer, to prevent the Chinese influence on their manufacturing.
The manufacturing transition was already on the movement way before Trump was even elected.
People need to stop bringing this into politics, it got nothing to do with it.
Foxconn CEO is consider to get into Taiwan politics, namely trying to run the presidential campaign.
Whenever that happen, China will be pretty piss off. This to start the transition of company into US as Apple is one of their largest customer, to prevent the Chinese influence on their manufacturing.
The manufacturing transition was already on the movement way before Trump was even elected.
People need to stop bringing this into politics, it got nothing to do with it.
Total operating cost includes a lot of things beyond R&D. Thinks like marketing, their prestige flying saucer, and a whole lot of things Apple is doing that have nothing to do with bringing an iPhone to market.
Apple's R&D budget: https://www.aboveavalon.com/notes/2016/5/11/apple-rd-reveals-a-pivot-is-coming
or if you prefer:
http://time.com/4339940/apple-rd-research-development/
Those articles also speculates a lot of that $10 billion is going to some surprises Apple has in store for us in the next few years. They don't spend a whole lot per iPhone on R&D.
The payment is low enough with approx 400USD / month. So yes accommodation in the dorm (8 people per room) and food is on top of that. As most factory line workers are anyway from inside china this is pretty much the only way they can work in a factory like this as daily commuting home is not an option.
if they could save 1 cent per unit by moving production to china they would do it because that is what corporations do...squeeze profit for shareholders
Sorry. That is a gross exaggeration and though emotional in origin, it is incorrect.
One cent per unit on 200 million iPhones last year is $2 million. Considering the way they treat their own retail staff in the US, is it so surprising if they'd screw over American for $2 million.
I know very well regarding operating costs but let me tell you that apple does not design all the components of iPhone you will need to consider vendor costs as well while deciding the price of an iPhone. They are corporations and they work for profits and we have no right to question their pricing and business strategy. If we like their product and pricing we will buy otherwise we will give it a pass. There will be lot of products which will be under deign development which may not make into production at all and corporations do charge us for all that work.
Thanks for the links Have a good night sir.
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Sir I don't think Apple is manufacturing in China to save $2million. If that is true it can bring all its manufacturing to US $2 miliion in tax breaks can be done.
And I was saying all along they change the maximum they can get for their product and cost to produce it is irrelevant. I said it in the first post you replied to when you started this conversation.
And I've also said the R&D of their suppliers is irrelevant because it is built into the cost of the components. But since you insist on bringing that up, a modern chip fab costs around $3 billion, diving that over 400 million iPhones over 2 years (2 CPUs on the same fab tech) is less than $10 per iPhone. And, of course that $3 billion fab is used for more than just iPhones and well beyond 2 years for less cutting edge chips, so you still can't attribute the whole amount to iPhone. Similar for a display fab, $7 billion is just not very much investment per display produced when you're talking about a fab that will produce a few billion displays in its lifetime.
These R&D and tooling costs are just not major components of the cost of tech on a per unit basis.
I also don't think they're only saving a single cent per iPhone compared to making them in the US. I was replying to a poster who was talking about an exageration.
