Foxconn claims it can make all of Apple's iPhones outside China

Posted:
in General Discussion
Foxconn has told investors that it has the capacity to produce iPhones for the American market without using its Chinese facilities, potentially skirting possible US/China trade tariffs.

Tim Cook visiting a Foxconn plant in China
Tim Cook visiting a Foxconn plant in China


Specifically, a senior executive says that Foxconn can make enough iPhones to supply the entire US market and do so out in territories that would avoid incurring any US/China tariffs.

According to Bloomberg, Young Liu, semiconductor division chief at Hon Hai, also known as Foxconn, was speaking at an investor briefing in Taipei.

"Twenty-five percent of our production capacity is outside of China," he said, "and we can help Apple respond to its needs in the US market. We have enough capacity to meet Apple's demand."

Liu confirmed that Apple has not requested such a move yet, nor did he detail which Foxconn facilities might be used after such a move. He was telling investors that Foxconn is able to move quickly and change its use of facilities in different countries to avoid such trade wars.

Foxconn has previously been investigating moving iPhone production to India and to Vietnam.

Bloomberg says that Liu gave Foxconn's decision to build a base in Wisconsin as an example of its worldwide production capability. That operation has been controversially delayed and changed but other company executives reportedly reaffirmed Foxconn's commitment to the US state.

It plans to hire up to 2,000 people by the end of 2020, though this is is substantially fewer than the 13,000 originally promised.
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Comments

  • Reply 1 of 41
    Impressive and Awesome.  
    watto_cobra
  • Reply 2 of 41
    ksecksec Posts: 1,567member
    Worth doing some numbers.

    Apple roughly ships 200M iPhone, 100M of those are not the latest, i.e iPhone 8 and below. Foxconn in India already has the ability to assemble those phones if and when needed. It is only a matter of scale.

    US has roughly 30% of Apple's revenue, so assuming in perfect scale ( which won't be the case but for the sake of numbers ), Foxconn will need to assemble 15M older generation iPhone and 15M latest iPhone outside of China.
    watto_cobra
  • Reply 3 of 41
    crossladcrosslad Posts: 503member
    ksec said:
    Worth doing some numbers.

    Apple roughly ships 200M iPhone, 100M of those are not the latest, i.e iPhone 8 and below. Foxconn in India already has the ability to assemble those phones if and when needed. It is only a matter of scale.

    US has roughly 30% of Apple's revenue, so assuming in perfect scale ( which won't be the case but for the sake of numbers ), Foxconn will need to assemble 15M older generation iPhone and 15M latest iPhone outside of China.
    I think you need to change your last figures to 30M of each phone. 
    JustSomeGuy1racerhomie3muthuk_vanalingamcornchipwatto_cobra
  • Reply 4 of 41
    GeorgeBMacGeorgeBMac Posts: 5,274member
    Amazing the power of propaganda to, in short order, and without evidence, label an entire country a dangerous enemy.  While a country that actually attacked us and continues to attack us is labelled as a friend.  And then to watch supposedly intelligent, mature people and organizations jump on the bandwagon. 

    Sad and scary.
    genovellemuthuk_vanalingamtyler82gilly33montrosemacscornchip
  • Reply 5 of 41
    ksec said:
    Worth doing some numbers.

    Apple roughly ships 200M iPhone, 100M of those are not the latest, i.e iPhone 8 and below. Foxconn in India already has the ability to assemble those phones if and when needed. It is only a matter of scale.

    US has roughly 30% of Apple's revenue, so assuming in perfect scale ( which won't be the case but for the sake of numbers ), Foxconn will need to assemble 15M older generation iPhone and 15M latest iPhone outside of China.
    This doesn't make sense.  You can't use # of phones as a proxy for revenue.  There are too many things wrong here.  You've basically said Apple needs to make 30M phones -total- for the US.  Does that sound right to you?

    Just find one of those estimates from Gartner, IDC, etc. and look at their yearly US sales estimates.  That's approximately how many phones Foxconn would need to assemble outside of China.  It's going to be more than 30M ;)
  • Reply 6 of 41
    PylonsPylons Posts: 21member
    Which is it? All of Apples iPhones (as in the title) or all iPhones for the US market? The article reads like it's the latter, but there's a huge difference.
    randominternetpersonwatto_cobra
  • Reply 7 of 41
    ben20ben20 Posts: 122member
    Foxconn is such a smart company! Who said again it can't be done? Next thing I know my new phone is assembled in Wisconsin lol
    jbdragonwatto_cobra
  • Reply 8 of 41
    maestro64maestro64 Posts: 4,678member
    This is the point I have been making for a while, China has more to loose here, no US company is just going to stand idlily by and take in the shorts, they will work to move production elsewhere. China has the factories and stolen knowhow, beyond this they have nothing competitive to offer. The people in China are consumers but not at the level of the US. China can not afford to loose the 1M jobs that Apple product production employees in the China.

    However, China is playing the long game since they know US policies move with the political winds, and they making a bet they in 18 months things will be different. Even if 18 month turns into 5 yrs they still in the long game and do not care if their economy suffers. Xi Jinping will be there long after the US political winds switch direction multiply times.
    jbdragon
  • Reply 9 of 41
    genovellegenovelle Posts: 982member
    ben20 said:
    Foxconn is such a smart company! Who said again it can't be done? Next thing I know my new phone is assembled in Wisconsin lol
    And cost as much as a Gazaxy fold
    lkrupp
  • Reply 10 of 41
    genovellegenovelle Posts: 982member
    Trade wars in 2019 are counterproductive. The majority of or largest companies and US employers make up to 2/3rds of their money from outside the US. And most of their profit leverages China’s skills and affordable manufacturing abilities to sell to the rest of the world. In Apple’s case, only 30% is US sales. If they were forced to American only they would go under at this point. The same for companies like Mcdonald, Google, Microsoft etc...
    GeorgeBMac
  • Reply 11 of 41
    lkrupplkrupp Posts: 7,463member
    genovelle said:
    Trade wars in 2019 are counterproductive. The majority of or largest companies and US employers make up to 2/3rds of their money from outside the US. And most of their profit leverages China’s skills and affordable manufacturing abilities to sell to the rest of the world. In Apple’s case, only 30% is US sales. If they were forced to American only they would go under at this point. The same for companies like Mcdonald, Google, Microsoft etc...
    And there’s the rub. Many of these companies no longer consider themselves “American” and therefore the economic interests of the American people are not on their radar when they make decisions. Apple in particular doesn’t even wave the flag anymore. ”Designed in California” is annoying for its marketing blather. It’s also true that the United States is the world’s biggest consumer and the rest of the world’s manufacturing depends on our consumption. We may soon become the second largest economy but if we go down the rest of the planet follows us down the drain.
    cornchip
  • Reply 12 of 41
    lkrupplkrupp Posts: 7,463member

    ben20 said:
    Foxconn is such a smart company! Who said again it can't be done? Next thing I know my new phone is assembled in Wisconsin lol
    Of course Foxconn was not talking about U.S. manufacturing but Indonesia, India, Vietnam, etc. I read an article about how China is skirting around the tariffs by sticking “Made in Vietnam” on stuff, Vietnam being a Chinese satellite and also a communist totalitarian state.
    GeorgeBMaccornchip
  • Reply 13 of 41
    iOS_Guy80iOS_Guy80 Posts: 254member
    Pylons said:
    Which is it? All of Apples iPhones (as in the title) or all iPhones for the US market? The article reads like it's the latter, but there's a huge difference.

  • Reply 14 of 41
    genovellegenovelle Posts: 982member
    lkrupp said:
    genovelle said:
    Trade wars in 2019 are counterproductive. The majority of or largest companies and US employers make up to 2/3rds of their money from outside the US. And most of their profit leverages China’s skills and affordable manufacturing abilities to sell to the rest of the world. In Apple’s case, only 30% is US sales. If they were forced to American only they would go under at this point. The same for companies like Mcdonald, Google, Microsoft etc...
    And there’s the rub. Many of these companies no longer consider themselves “American” and therefore the economic interests of the American people are not on their radar when they make decisions. Apple in particular doesn’t even wave the flag anymore. ”Designed in California” is annoying for its marketing blather. It’s also true that the United States is the world’s biggest consumer and the rest of the world’s manufacturing depends on our consumption. We may soon become the second largest economy but if we go down the rest of the planet follows us down the drain.
    The point is these companies are combined the largest employers of US citizens. They are able to afford to pay far more than China can pay for manufacturing with jobs that have more monetary value. We are not the largest consumers of even our own goods which is why these companies depend on growth internationally. It’s why even our farmers need to be bailed out when the trade war forced China to buy their produce elsewhere. 

    We we have an inflated value of ourselves, but our GDP was much smaller when we were isolated. The major drivers of our economy are multinational companies that make stuff and provide services that the world needs, not just the US. 
  • Reply 15 of 41
    StrangeDaysStrangeDays Posts: 8,809member
    Amazing the power of propaganda to, in short order, and without evidence, label an entire country a dangerous enemy.  While a country that actually attacked us and continues to attack us is labelled as a friend.  And then to watch supposedly intelligent, mature people and organizations jump on the bandwagon. 

    Sad and scary.
    I've been to China for a few weeks as part of my university studies. There's plenty of evidence to consider China a dangerous enemy, especially to individual freedom and civil rights. Maybe you don't remember Tank Man? China is a single-party authoritative regime and routinely executes or imprisons political dissidents and those it considers enemies. You're seriously high if you're denying this is fact.

    The people of China were a different story. But the party-controlled government of China is very dangerous. They are the last people in the world I'd want to give leverage or the keys to communications.
    edited June 11 cornchipdocno42
  • Reply 16 of 41
    mike54mike54 Posts: 349member
    China has become very advanced and very competitive, something which the US wants to put a halt to, it simply does not want competition.
    As far as Apple is concerned I'm sure they have been looking elsewhere where they can get a higher profit ratio. There are other places where labour is cheaper than in China, maybe India, Vietnam, Bangladesh, etc.


  • Reply 17 of 41
    gilly33gilly33 Posts: 293member
    Hmmm...that’s all I got on that report. 
  • Reply 18 of 41
    normmnormm Posts: 575member
    Amazing the power of propaganda to, in short order, and without evidence, label an entire country a dangerous enemy.  While a country that actually attacked us and continues to attack us is labelled as a friend.  And then to watch supposedly intelligent, mature people and organizations jump on the bandwagon. 

    Sad and scary.
    I've been to China for a few weeks as part of my university studies. There's plenty of evidence to consider China a dangerous enemy, especially to individual freedom and civil rights. Maybe you don't remember Tank Man? China is a single-party authoritative regime and routinely executes or imprisons political dissidents and those it considers enemies. You're seriously high if you're denying this is fact.

    The people of China were a different story. But the party-controlled government of China is very dangerous. They are the last people in the world I'd want to give leverage or the keys to communications.
    World trade with China has lifted a billion people there out of poverty, made war with them enormously less likely, and made the whole world much more efficient and prosperous.  Contact with capitalism and democracy is contagious.  Yes, take precautions, but don't screw up the world.
    edited June 11 FileMakerFeller
  • Reply 19 of 41
    StrangeDaysStrangeDays Posts: 8,809member
    normm said:
    Amazing the power of propaganda to, in short order, and without evidence, label an entire country a dangerous enemy.  While a country that actually attacked us and continues to attack us is labelled as a friend.  And then to watch supposedly intelligent, mature people and organizations jump on the bandwagon. 

    Sad and scary.
    I've been to China for a few weeks as part of my university studies. There's plenty of evidence to consider China a dangerous enemy, especially to individual freedom and civil rights. Maybe you don't remember Tank Man? China is a single-party authoritative regime and routinely executes or imprisons political dissidents and those it considers enemies. You're seriously high if you're denying this is fact.

    The people of China were a different story. But the party-controlled government of China is very dangerous. They are the last people in the world I'd want to give leverage or the keys to communications.
    World trade with China has lifted a billion people there out of poverty, made war with them enormously less likely, and made the whole world much more efficient and prosperous.  Contact with capitalism and democracy is contagious.  Yes, take precautions, but don't screw up the world.
    And yet reality in China says otherwise -- under the digital surveillance state the people of China have even less power and free exchange of information. The student-led democracy protests of the 1980s could likely not happen again. They have clamped down hard on that. The people of China are oppressed by murderous authoritarians. This is fact, and was my point in response to the naive person who said China is not dangerous. They are quite dangerous to the ideas valued by free civilizations.
    crfcomcornchipdocno42
  • Reply 20 of 41
    SpamSandwichSpamSandwich Posts: 31,504member
    Why wait? Start the transition now.
    cornchip
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