Apple wants to continue building Mac Pro in US, Cook says

Posted:
in General Discussion edited July 30
Apple CEO Tim Cook has responded to questions about moving production away from China by saying that he expects the company's global production to continue on its current trajectory, but also that it is investing to increase U.S. manufacturing.

Apple's forthcoming Mac Pro 2019
Apple's forthcoming Mac Pro 2019


Asked by analysts in its financial earnings call to comment on President Trump's refusal to grant Apple an exclusion from tariffs in its manufacturing, Cook spoke about the company's view of the U.S./China relationship and his opinion about whether Apple will move production to new countries. Specifically, the chief executive said Apple is looking for ways to continue building -- more accurately assembling -- its Mac Pro desktop domestically.

"In terms of the exclusions, we've been making the Mac Pro in the U.S. and we want to continue to do that," he said, "so we're working and investing currently in capacity to do so, because we want to continue to be here."

The current Mac Pro is assembled in a factory in Austin, Tex., with parts sourced from around the world. For the incoming 2019 Mac Pro, however, Apple has handed off manufacturing duties to Quanta in China.

Cook's comments shed new light on Apple's tariff exclusion request, which involved parts associated with the new pro-level computer. It can be speculated that Apple was, and still is, seeking economical alternatives to assemble the Mac Pro in America, with those efforts stymied by the ongoing trade war.

On a broader level, Cook said to disregard rumors of a major shift in Apple's outsourcing strategy.

"There's been a lot of speculation around the topic of different moves," he said, "but I wouldn't put a lot of stock in that if I were you. The way that I view this is that the vast majority of our products are kind of made everywhere. There's a significant level of content from the United States, and a lot from Japan to Korea to China, and the European Union also contributes a fair amount. That's the nature of a global business and I think that largely that will carry the day, and in the future as well."

Cook's comments follow recent reports of Apple looking to move some proportion of manufacturing assembly out of mainland China, and that such a move would take several years.

Comments

  • Reply 1 of 20
    No need to get worked up, or the read too much into other people's rumors or Cook's statement. For assembly and final configuration, Austin makes a lot of sense. More so since the unit volumes are low and the option combinations are numerous. These decisions can be revisited in the future, and the specific labor can be divided in many ways.

    I'd bet a lot of the Mac Pro consumers are in the US, who will appreciate faster shipping times for custom configurations.

    And the assembly labor of the Mac Pro is tiny compared to Apple's total cost structure.
    edited July 30 applesnoranges
  • Reply 2 of 20
    SpamSandwichSpamSandwich Posts: 31,301member
    Would be delighted if Apple moved far more production to the US, even if it meant a drastic increase in the use of robot assembly.
    6502macseekerwatto_cobra
  • Reply 3 of 20
    StrangeDaysStrangeDays Posts: 8,244member
    Would be delighted if Apple moved far more production to the US, even if it meant a drastic increase in the use of robot assembly.
    If they don’t use humans to do the work what’s the point? A few inventory management jobs? Yawn. 
    Solioirudleahcim
  • Reply 4 of 20
    macxpressmacxpress Posts: 4,934member
    Would be delighted if Apple moved far more production to the US, even if it meant a drastic increase in the use of robot assembly.
    If they don’t use humans to do the work what’s the point? A few inventory management jobs? Yawn. 
    Exactly! If its made primarily by robots then what difference does it make where it's made. It could be made in Cuba and the result would be the same as China, USA, Belgium, Australia, etc. Robots are robots. Very little jobs will be made.
    oirudleahcim
  • Reply 5 of 20
    entropysentropys Posts: 1,795member
    I, for one, welcome our new inventory management overlords.
    racerhomie3watto_cobra
  • Reply 6 of 20
    mattinozmattinoz Posts: 1,121member
    No need to get worked up, or the read too much into other people's rumors or Cook's statement. For assembly and final configuration, Austin makes a lot of sense. More so since the unit volumes are low and the option combinations are numerous. These decisions can be revisited in the future, and the specific labor can be divided in many ways.

    I'd bet a lot of the Mac Pro consumers are in the US, who will appreciate faster shipping times for custom configurations.

    And the assembly labor of the Mac Pro is tiny compared to Apple's total cost structure.
    Isn't it modular?
    They could be built instore on demand componets come from were they come from.
    Online order just ship from nerest store.
    watto_cobra
  • Reply 7 of 20
    65026502 Posts: 276member
    Would be delighted if Apple moved far more production to the US, even if it meant a drastic increase in the use of robot assembly.
    If they don’t use humans to do the work what’s the point? A few inventory management jobs? Yawn. 
    Real estate and property taxes
    Truckers to bring materials in and out
    Automation engineers to build, maintain and upgrade the equipment
    Facility managers and workers to keep the plants running
    Logistic specialists
    Local businesses, restaurants, hotels, etc...

    These are all well paid blue and white collar workers that probably would make more than all the assembly workers in china combined.
    macseekerwatto_cobraCurtisHightoirudleahcim
  • Reply 8 of 20
    netroxnetrox Posts: 755member
    Would be delighted if Apple moved far more production to the US, even if it meant a drastic increase in the use of robot assembly.
    It's the scale that is the issue. We simply do not have American manpower to produce devices fast enough to meet the demands.
    watto_cobra
  • Reply 9 of 20
    Would be delighted if Apple moved far more production to the US, even if it meant a drastic increase in the use of robot assembly.
    What would be really cool if they had famous robots from scifi building them. Like Bender and Robbie the Robot.
    watto_cobra
  • Reply 10 of 20
    SpamSandwichSpamSandwich Posts: 31,301member
    netrox said:
    Would be delighted if Apple moved far more production to the US, even if it meant a drastic increase in the use of robot assembly.
    It's the scale that is the issue. We simply do not have American manpower to produce devices fast enough to meet the demands.
    The use of any human laborers in the US for assembly or other manual positions prices us out of the existing market. Robot assembly is the only way to remain competitive, at least until minimum wage laws are eliminated.
    watto_cobra
  • Reply 11 of 20
    rob53rob53 Posts: 2,074member
    The biggest issue is tariffs and just because the final assembly may be performed in the US doesn't mean tariffs won't be applied to all the components manufactured in China and other countries subject to tariffs. 

    Who manufactures the CPU? 
    Who manufactures the RAM?
    Who manufactures the SSD?
    Who manufactures the GPU?
    Where is the aluminum for the case smelted?
    Where are all the individual resistors, capacitors and even the circuit board connectors manufactured?

    Every one of these have labor costs as well as the potential for tariffs. If anyone can fill in this information it might help everyone understand just how complex and global Apple's supply chain is and how it is affected by tariffs as well as the change in the value of the dollar.
    Soli
  • Reply 12 of 20
    macseekermacseeker Posts: 445member
    Would be delighted if Apple moved far more production to the US, even if it meant a drastic increase in the use of robot assembly.
    What would be really cool if they had famous robots from scifi building them. Like Bender and Robbie the Robot.
    Robbie the Robot can do anything.
    watto_cobra
  • Reply 13 of 20
    mike fixmike fix Posts: 245member
    Considering they're going to sell about 100 of them, building them in the US makes sense.
  • Reply 14 of 20
    dewmedewme Posts: 2,121member
    6502 said:
    Would be delighted if Apple moved far more production to the US, even if it meant a drastic increase in the use of robot assembly.
    If they don’t use humans to do the work what’s the point? A few inventory management jobs? Yawn. 
    Real estate and property taxes
    Truckers to bring materials in and out
    Automation engineers to build, maintain and upgrade the equipment
    Facility managers and workers to keep the plants running
    Logistic specialists
    Local businesses, restaurants, hotels, etc...

    These are all well paid blue and white collar workers that probably would make more than all the assembly workers in china combined.
    You've actually pointed out quite nicely what's really happened to much of the previous generation manufacturing based labor force in the US - those jobs have been moved away from hands-on manufacturing-based jobs to service-based jobs. Of course it has not been a 1:1 swap in terms of total number of jobs, required skills and knowledge, or earnings potential. Some things are higher and some things are lower, and oftentimes staggeringly so.

    One subtle point of interest is that when it comes to robotics the biggest manufacturers of robots, the actual hardware and machinery, the industry is dominated by non-US based robotics companies. Likewise, factory automation equipment makers, when viewed in the aggregate of both discrete control plus process control equipment, you'll see  a domination by non-US based firms here as well. Only two of the top-ten industrial automation companies in the world can be considered US based companies, and both of these companies have significant numbers of globally manufactured hardware and software products in their portfolio. 

    In truth, whether the Mac Pro is assembled in Texas or China isn't going to make a bit of difference when it comes to the bigger picture of where things that power the US economy get built and who gets to build them. It's 100% about political optics. The sad part of the political posturing is that all this talk about bringing back the manufacturing jobs of the Past that supposedly made America great does absolutely nothing in terms of positioning the US to be in a better position to compete for the jobs of the Future. Whatever happened to an America that focused on skating to where the puck is going to be instead of getting mired in corrosive nostalgia to skate back to where the puck used to be?  Fighting to regain one's past glory is a great distraction for dying old men, but it is no way to lead a growing country intent of living and thriving in the future forward. I'm just glad that we have some leaders of modern industry like Tim Cook, Jeff Bezos, and Elon Musk who understand the importance of being forward looking and constantly growing to counter the legions of fading politicians basking in their own self importance, nostalgia, and polishing their self crafted revisonist legacies.


  • Reply 15 of 20
    Mike WuertheleMike Wuerthele Posts: 4,756administrator
    rob53 said:
    The biggest issue is tariffs and just because the final assembly may be performed in the US doesn't mean tariffs won't be applied to all the components manufactured in China and other countries subject to tariffs. 

    Who manufactures the CPU? 
    Who manufactures the RAM?
    Who manufactures the SSD?
    Who manufactures the GPU?
    Where is the aluminum for the case smelted?
    Where are all the individual resistors, capacitors and even the circuit board connectors manufactured?

    Every one of these have labor costs as well as the potential for tariffs. If anyone can fill in this information it might help everyone understand just how complex and global Apple's supply chain is and how it is affected by tariffs as well as the change in the value of the dollar.
    CPU - Intel, fab probably in Israel, with assembly and test probably in China
    RAM - SK Hynix probably, South Korea
    SSD - Probably Samsung, South Korea
    GPU - AMD - depends, but most likely China
    Aluminum - Zenica Aluminum, China

    And, the vast majority of the resistors, capacators, and connectors in China.
    gatorguy
  • Reply 16 of 20
    gatorguygatorguy Posts: 20,894member
    rob53 said:
    The biggest issue is tariffs and just because the final assembly may be performed in the US doesn't mean tariffs won't be applied to all the components manufactured in China and other countries subject to tariffs. 

    Who manufactures the CPU? 
    Who manufactures the RAM?
    Who manufactures the SSD?
    Who manufactures the GPU?
    Where is the aluminum for the case smelted?
    Where are all the individual resistors, capacitors and even the circuit board connectors manufactured?

    Every one of these have labor costs as well as the potential for tariffs. If anyone can fill in this information it might help everyone understand just how complex and global Apple's supply chain is and how it is affected by tariffs as well as the change in the value of the dollar.
    Adding to Mike's helpful post.
    https://macrofab.com/blog/decoding-tariff-impacts-us-electronics-manufacturing/
    The latter half of that article should be of particular interest to you. 
    edited July 31
  • Reply 17 of 20
    melgrossmelgross Posts: 31,780member
    Some things can be built by robots, and some things can’t. Robots are very good at inserting components into circuit boards. But they suck at screwing those circuit boards into a chassis.

    in building any product, the assembly of the component sub assemblies have to be dealt with on an individual basis. What I mean is that some of them can be robot assembled, and some can’t. For example. Robots can work very well on flat surfaces in inserting parts as I’ve said. But if an assembly is three dimensional, and needs to be rotated several times to be assembled, it’s very difficult to have that done robotically.

    we see tens of thousand of people on lines assembling iPhones. That’s because robots can’t do it, even though the boards were done by them. They can’t put the board in the case, because that involves maneuvering the case and boards in what to a robot would be very complex gyrations. Then bending and threading those small cables, and plugging and gluing them in can’t be done either.

    I'm not saying that never in the future will this be done. But present technology can’t. So it’s pretty much pie in the sky when people just offhand state that we can use robots instead of large numbers of people.
  • Reply 18 of 20
    If Apple built robot arms I would buy one, and Apple could use them too to build their products. (The abbreviation for SkyNet is SN, and SN is also an abbreviation for Sino, which is China. Coincidence?)
  • Reply 19 of 20
    Arina14Arina14 Posts: 10member
    Would be delighted if Apple moved far more production to the US, even if it meant a drastic increase in the use of robot assembly.
    If they don’t use humans to do the work what’s the point? A few inventory management jobs? Yawn. 
    It's been demonstrated numerous times across different industries that the use of robots to handle menial, time-consuming, repetitive or physically strenuous jobs will lead to the creation of more challenging, and better-paying tasks that are more suitable for human beings. 
  • Reply 20 of 20
    melgrossmelgross Posts: 31,780member
    Arina14 said:
    Would be delighted if Apple moved far more production to the US, even if it meant a drastic increase in the use of robot assembly.
    If they don’t use humans to do the work what’s the point? A few inventory management jobs? Yawn. 
    It's been demonstrated numerous times across different industries that the use of robots to handle menial, time-consuming, repetitive or physically strenuous jobs will lead to the creation of more challenging, and better-paying tasks that are more suitable for human beings. 
    If only that were true, but it’s not any longer. The computerization of industry is vastly different than mechanical automation. In fact it’s considered that the jobs to go will be in the professional realms. And, not to seem elitist, but half the population has an IQ below 100. What challenging tasks, or careers are they going to have for them? Unfortunately, someone with a 100 IQ would have a difficult time of making it through a two year college. We have to be realistic about this, and drop our idealism at the door.
Sign In or Register to comment.