I'm not sure what Asian has to do with this. I really hope you are not trying to say all Asians are in ethical or can't be trusted. If you are it is a sad comment on you as a person.
Originally Posted by mstone
Sometimes it makes you wonder if you can trust anything these Asian suppliers say. They are competing with Apple and also a vendor.
And this is a surprise? Get real and learn a bit about business.
Beside at the level Apple works business relationships are built on trust and an epectation of ethical behavior. Their may be lawyers crossing the tees and dotting the eyes but it is the handshake and the relationship between CEOs that make or breaks deals.
With the leaks and the knock offs, stealing IP and everything else, how long can these relationships last? It is definitely the Achilles' heel for Apple.
Well dealing with China is bad for most of America, so Apple isn't alone here. The problem is China is one of the few places in the world that has the ability to put electronics production lines into operation at low cost.
As to how long the relationships can last, that is simple a very long time. Take the example of Samsung a vendor that Apple has had a very long relationship with. That relatioship will remain solid for a very long time as long as the principals trust each other and each side acts in good faith. The A4 processor is a good example here, Apple could have went with a number of chip foundries to produce the A4 but remained with Samsung. It wasn't about technology as that came from Intrinsity, rather I believe it is about having a partner you can trust. The fact that Intrinsity was also working with Samsung prior to Apples buy out factors in there too.
In any event people have trouble here reading between the lines or for that matter taking comments from CEOs at face value. Apple has already said that they grossly underestimated the demand for iPad and are now placing orders for double what was expected.
It is pretty easy to build a production line for a million items a month, get it setup and running smoothly. It does not however happen instantly. Doubling your production takes the same amount of time as it took to make the first production line. So LG has to literally build another production line which again takes time.
What has happened here is that Apple missed badly on expected production demand. So what likely happened is that the CEOs of the various companies work with Apple sat around a round table or a virtual one and went over the expected production demand trying to fit capacity to that demand. There in they determined what sort of plants had to be built and committed to a timetable to get the production lines up. At that time production capacity is fixed more or less. This likely happened early in 2009. Some parts of the production process might be easy to duplicate but what this comment, from the LG CEO, is telling us is that doubling production on the LCD line isn't that easy and is indeed the limiting factor. Setting up a production line with complex tools can take months and that only happens after the tools arrive.
One thing I don't disagree with you is on the need for manufactures like Apple to do more manufacturing in the USA. However that has nothing to do with being Able to trust Asian manufactures. It is more about industrial capacity, quality of life and national security. Much of manufacturing went to Asia due to herd mentality and irrational consumer demand for ever cheaper gadgets.
Know don't think I'm against international commerce or free trade. Rather I think that companies like Apple need to demonstrate some balance with respect to sourcing a devices components. Producing A4 in the US would be setting a good example. That doesn't mean that Apple should build it's own plants (that is another discussion) but rather they should partner with foundries in the US.