Stop manufacturing in China?

Posted:
in General Discussion edited January 2014
I'm currently not happy with my $$ going to China. Which lead me to these questions...



How much more do you think Apple's products would cost if Apple ceased production in China?



Would you be willing to pay that extra amount?



Do you think there are cheaper alternatives to China?



Would it be at all possible to produce Apple products in the USA?

Comments

  • Reply 1 of 18
    hmurchisonhmurchison Posts: 12,359member
    I would pay more.





    Americans typically collect so much junk they can't even park their cars in the garages. When I walk through Target and see the $1 area all I see are things that will be in some landfill some day soon.



    America has neglected manufacturing and that's sad because when you look at our land mass we have space to build out more rural areas and put "country folk" to work.



    I don't necessarily like living near the city but that's where the jobs are. I don't like making China a bigger and bigger threat as the months roll by.
  • Reply 2 of 18
    SpamSandwichSpamSandwich Posts: 33,407member
    Quote:
    Originally Posted by Mike Fix View Post


    I'm currently not happy with my $$ going to China. Which lead me to these questions...



    How much more do you think Apple's products would cost if Apple ceased production in China?



    Would you be willing to pay that extra amount?



    Do you think there are cheaper alternatives to China?



    Would it be at all possible to produce Apple products in the USA?



    What about India, Brazil or Mexico?
  • Reply 3 of 18
    slewisslewis Posts: 2,081member
    Null.
  • Reply 4 of 18
    SpamSandwichSpamSandwich Posts: 33,407member
    Quote:
    Originally Posted by Slewis View Post


    Doesn't really matter to me, but someday they might start manufacturing here if our dollar continues to drop ^_^



    Currently $1 is equal to ~7 Chinese Yuan Renminbi and ~€0.64.



    Sebastian



    That 1:7 ratio will not change despite the dollar drop, unless the Chinese government de-links the RMB from the dollar.
  • Reply 5 of 18
    slewisslewis Posts: 2,081member
    Null.
  • Reply 6 of 18
    Quote:
    Originally Posted by SpamSandwich View Post


    That 1:7 ratio will not change despite the dollar drop, unless the Chinese government de-links the RMB from the dollar.



    To be fair, the RMB has been significantly de-linked from the dollar. It's now tied to a basket of currencies including the euro, yen, won, pound, and others. It's that 0.3% daily float range that holds it back.



    I would (and do) tend to pay more for local and domestically made products as long as all other factors are equal, and I would be willing to pay more for US-made Apple hardware.
  • Reply 7 of 18
    mydomydo Posts: 1,888member
    Plus the wages in China are cheap and environmental laws are weak (or at least the enforcement).
  • Reply 8 of 18
    The question then is, can Apple create a "value added" made in USA product and keep the cheaper made in asia products for those who don't want to pay the premium? Something like what Fender does with the Stratocaster?
  • Reply 9 of 18
    splinemodelsplinemodel Posts: 7,311member
    Quote:
    Originally Posted by Mike Fix View Post


    Do you think there are cheaper alternatives to China?



    Would it be at all possible to produce Apple products in the USA?



    1. No: the chinese government ensures that it maintains an enslaved populace. Slavery is cheap.



    2. Yes, only if the unions were held-back and the prices were still accepted to be higher than before.





    It's possible that labor could be conducted in Eastern Europe or South America. IBM had an HD unit in Hungary for a while.
  • Reply 10 of 18
    SpamSandwichSpamSandwich Posts: 33,407member
    Quote:
    Originally Posted by mydo View Post


    environmental laws are weak (or at least the enforcement).



    You have no idea how bad things really are until you've breathed in the poison they call air over there. My last trip to Shenzhen and the Guangdong area was a horror of toxic rivers and unburied landfill. I kid you not, piles of garbage two stories high behind buildings. The Chinese people are being killed off by their own success.
  • Reply 11 of 18
    mydomydo Posts: 1,888member
    Yea I've seen that type of stuff on TV. The farm down the road from the factory becomes the new dump. Farming continues.



    The Olympics are going to be a disaster. The only good thing to come of it is that it will be worse than Atlanta.
  • Reply 12 of 18
    SpamSandwichSpamSandwich Posts: 33,407member
    Quote:
    Originally Posted by mydo View Post


    Yea I've seen that type of stuff on TV. The farm down the road from the factory becomes the new dump. Farming continues.



    The Olympics are going to be a disaster. The only good thing to come of it is that it will be worse than Atlanta.



    Well, it'll look spectacular on TV, I can guarantee that.
  • Reply 13 of 18
    sc_marktsc_markt Posts: 1,398member
    Has anybody really notice if China made goods really are cheaper? In my experience, most of what I've bought from China (that I had recently bought earlier when made in America or another western country) was comparatively priced to the China products.



    In my opinion, we ought to move as much US manufacturing out of China as possible and into Mexico.
  • Reply 14 of 18
    Quote:
    Originally Posted by sc_markt View Post


    Has anybody really notice if China made goods really are cheaper? In my experience, most of what I've bought from China (that I had recently bought earlier when made in America or another western country) was comparatively priced to the China products.



    In my opinion, we ought to move as much US manufacturing out of China as possible and into Mexico.



    You see, that's the thing. When American companies move production to a cheaper country, they do it to increase profit, not decrease price.



    A $10 thingamabob costs $5 to manufacture in the US. Thingamabob making company moves production to China, and with added shipping costs, the thingamabob now costs $4. Does the Thingamabob making company now sell the thingamabob at $9? Hell no! They keep the extra $1 as profit.
  • Reply 15 of 18
    splinemodelsplinemodel Posts: 7,311member
    Quote:
    Originally Posted by tonton View Post


    You see, that's the thing. When American companies move production to a cheaper country, they do it to increase profit, not decrease price.



    A $10 thingamabob costs $5 to manufacture in the US. Thingamabob making company moves production to China, and with added shipping costs, the thingamabob now costs $4. Does the Thingamabob making company now sell the thingamabob at $9? Hell no! They keep the extra $1 as profit.



    That's not really true. In competitive markets, profit margins are low and don't generally change. The euphemism often used here is "razor thin [profit margins]." Antitrust laws also prevent collusion in price fixing. Any company that goes to China is in a highly competitive market. If they aren't, it's really not worth going to China. Some goods don't require much human interaction to produce. For these, it's cheaper to keep the plants local.
  • Reply 16 of 18
    gongon Posts: 2,437member
    Quote:
    Originally Posted by tonton View Post


    You see, that's the thing. When American companies move production to a cheaper country, they do it to increase profit, not decrease price.



    Wrong, it is not a case of either/or.



    Normal companies do everything to increase profit. If equivalent production can be done cheaper somewhere else, it'll always get moved there. But the claim that companies do not aim to decrease prices is false. Often you have to decrease prices to maximize profit. Often the decreased prices are not sustainable without moving the production.
  • Reply 17 of 18
    Quote:
    Originally Posted by Mike Fix View Post


    How much more do you think Apple's products would cost if Apple ceased production in China?



    20% ... that's just a guess.



    Quote:
    Originally Posted by Mike Fix View Post


    Would you be willing to pay that extra amount?



    Yes.



    Quote:
    Originally Posted by Mike Fix View Post


    Do you think there are cheaper alternatives to China?



    No.



    Quote:
    Originally Posted by Mike Fix View Post


    Would it be at all possible to produce Apple products in the USA?



    Yes. Easily. But the retail cost would probably rise by closer to 50%
  • Reply 18 of 18
    SpamSandwichSpamSandwich Posts: 33,407member
    It's laughable to suggest that industrial manufacturing can simply leap from country to country (or back to the US) as if one could simply wish it to happen. Much of the American manufacturing base has moved offshore and will not return. Our government policies, labor practices, consumer expectations and the competitive global marketplace have cemented that fact.



    When's the last time you remember seeing Wal-Mart crowing about their support for "Made In USA"? Anyone?



    If the dollar continues on it's current precipitous drop, however, we could become an even more attractive investment opportunity for foreign corporations... it's very possible that some industrial manufacturing could return to the US, but I really think our day in the sun for large scale manufacturing has passed.



    The trend of nano-fabrication and "desktop" manufacturing will continue to become much more sophisticated, to the point where many household and consumer items (except food) could be custom made for one person at a time. That is a bet I would place for the next 20 years.
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