Apple has manufacturing plants in every country they sell in. This would reduce shipping times and costs in the long run correct?
Or am I wrong ?
That would be a parts supply chain nightmare! One country will have a surplus of part X while another is running low. Tracking and warehousing the parts at each location would be expensive. Every location would have to have a full set of skilled labor (and/or robots) and one assembly line might sit idle because they have surplus finished product in their country's sales channel while another assembly line in another country would be struggling to keep up with their demand. And every time Apple updates the design, manufacturing engineers would need to travel to each and every assembly line to implement, test and verify the new process to ensure it is meeting Apple's strict quality standards.
Besides the aforementioned comments and the extra cost to split up shipping of components and other materials just to keep assembly and "last mile" shipping local to every county, the QA and time behind each country's launch will become excruciating long. Not to mention increased costs from economies of scale going out the window. Even the design is hindered by having to create for the lesser machines in those 120+ countries that sell Apple products.
Just gives more fuel to the fire that making iPhones in the USA is a good idea.
Uh, so that Apple isn't caught flat-footed when President (Elect) Trump and the Republican Congress legislate new tariffs, if they actually do that. Apple needs to know what the costs are.
Even then, I would note that these would only be shipped and sold within the U.S. and possible Canadian markets, and competitors would have the same tariff hurdle. The tradeoff is higher prices against increased U.S. jobs, but those jobs aren't going to the rust belt without subsidies, so yet again, cost increases. Most of the jobs will end up in Southern population centers, Texas primarily, and those jobs will go to first and second generation Hispanic Americans, who will be more accepting of a lower wage base.
The republican congress is never going to pass tarrifs.
Serious question: Why would it cost more to make iPhones with robots in the USA than it would in China?
I was thinking the same. I don't believe it will cost more. Might actually cost less because of shipping
Maintaining factories with tens of thousands of robots will require a major workforce. This workforce doesn't exist in the US today so creating one would be very expensive.
Apple has manufacturing plants in every country they sell in. This would reduce shipping times and costs in the long run correct?
Or am I wrong ?
Shipping times are irrelevant. Airplanes can deliver worldwide overnight. They airship launch quantities all the time. Costs are also immaterial. They can get so many iPhones on an airplane, that the cost/phone is minimal. When Apple is gearing up for a launch or the holidays they lock up a huge chunk of capacity making it harder and more expensive for anybody else to get space.
Once the supply and demand level off, shipping product via container ship is dirt cheap. Apple is a logistics machine.
"Although TSMC is very clear that it would be much more expensive to make chips outside of Taiwan, it's inevitable for the world's largest contract chipmaker to take 'Made in the U.S.' into consideration," said Sanford C. Bernstein analyst Mark Li. "The alternative is that it would lose Apple orders without moving to America."
I don't understand this!
I've been in my share of clean rooms and making chips is not a labor intensive process.
Yes but fabs are expensive. For example, Intel in 2011 at $5Bn. They also take time and skill to bring online.
Just gives more fuel to the fire that making iPhones in the USA is a good idea.
Uh, so that Apple isn't caught flat-footed when President (Elect) Trump and the Republican Congress legislate new tariffs, if they actually do that. Apple needs to know what the costs are.
Even then, I would note that these would only be shipped and sold within the U.S. and possible Canadian markets, and competitors would have the same tariff hurdle. The tradeoff is higher prices against increased U.S. jobs, but those jobs aren't going to the rust belt without subsidies, so yet again, cost increases. Most of the jobs will end up in Southern population centers, Texas primarily, and those jobs will go to first and second generation Hispanic Americans, who will be more accepting of a lower wage base.
The republican congress is never going to pass tarrifs.
No, they aren't, but Apple is just getting prepared to make the case.
Even then, I would note that these would only be shipped and sold within the U.S. and possible Canadian markets
Why should canadians - why should anyone outside the USA - want to pay higher prices for an iPhone only because the iPhone is made in the usa?
Those iPhones would be for export, so I assume wouldn't incur those same tariffs, assuming tariffs are on finished products shipped into the U.S. Market. I agree that is doesn't make much sense if it adds costs to the Canadian Markets.
Serious question: Why would it cost more to make iPhones with robots in the USA than it would in China?
Even Skynet needed humans to do some tasks the robots couldn't do.
But seriously, let’s see…property taxes, energy costs,
environmental regulations, cost of constructing the factories, retooling the
assembly lines every year for new iPhone models, cost of shipping the parts and
raw materials across the Pacific (could be higher than the cost of shipping the
resulting final product), inventory cost for keeping enough parts/raw materials
in the US to account for any disruptions in the trans-Pacific supply chain,
waste disposal costs. And of course, even with robots you’d still likely need
far more skilled labor to run and maintain the factories than is readily
available in the US.
In all likelihood, by the time Apple could build the
factories, train the staff and begin production, Trump would no longer be
President. So would it be better to just ride it out?
<Snip> we also can consider imposing taxes on goods from other countries that have ridiculously low minimum wages. that will force other countries to stop exploiting their people for politician and elite profits at the same time helping to make our country more competitive.
The above statement is correct. What rarely gets said is that doing it also makes all of our (your) people poorer ('cos the goods just got more expensive). You pays your money and you takes your choice.
As far as the foreign workers are concerned, history suggests that doing cheap manufacture is on the national development route to better things. I remember when Japan was the centre of cheap manufacture and then it was S. Korea. They outsource to China now.
Just gives more fuel to the fire that making iPhones in the USA is a good idea.
Uh, so that Apple isn't caught flat-footed when President (Elect) Trump and the Republican Congress legislate new tariffs, if they actually do that. Apple needs to know what the costs are.
Even then, I would note that these would only be shipped and sold within the U.S. and possible Canadian markets, and competitors would have the same tariff hurdle. The tradeoff is higher prices against increased U.S. jobs, but those jobs aren't going to the rust belt without subsidies, so yet again, cost increases. Most of the jobs will end up in Southern population centers, Texas primarily, and those jobs will go to first and second generation Hispanic Americans, who will be more accepting of a lower wage base.
The republican congress is never going to pass tarrifs.
They don't have to. The President has the power to implement limited tariffs without Congressional approval.
jbdragon said: More then $200 more on the base price iPhone is just crazy. To get a Plus version with 256 gig's will be like $1500. Who's going to pay these kind of prices?
Serious question: Why would it cost more to make iPhones with robots in the USA than it would in China?
Two reasons:
1). The Chinese robots are just the base models whereas the American versions need to be fitted with cowboy hats.
2). When the American Skynet software gains self-awareness and goes on a global genocidal killing rampage research has shown that costs can rise considerably.
Serious question: Why would it cost more to make iPhones with robots in the USA than it would in China?
Even Skynet needed humans to do some tasks the robots couldn't do.
Skynet was stupid. Skynet had control of the military installations, nuclear power plants, and could build a nuclear power cell for every terminator but it didn't think that it's best defense would be to cause massive fallout of radiation in every area they wished to away from organic lifeforms.
Serious question: Why would it cost more to make iPhones with robots in the USA than it would in China?
I was thinking the same. I don't believe it will cost more. Might actually cost less because of shipping
Every single aspect of running an assembly plant in the US has higher costs. Energy, labor, land, construction, taxes, benefits, waste disposal, management - on and on. All of those things either cost a lot less in China or don't exist there.
The republican congress is never going to pass tarrifs.
No, they aren't, but Apple is just getting prepared to make the case.
I would imagine that any significant tarrifs levied against China would result in some sort of trade war, and eventually a real war. It's not a debt thing - China only holds 8% of our debt. It's more of a "why hurt ourselves to try and hurt China?" thing.
They don't have to. The President has the power to implement limited tariffs without Congressional approval.
News Flash: Apple Corp. moves company Headquarters to Geneva. Apple now a Swiss Corporation.
What then, a world-wide Trade War?
You don't understand how tariffs work. It's not a tax on the company to make the product, it's a fee to bring it into the country. Where Apple is HQ'd is irrelevant. If they want to bring product into the US they'd have to pay the tariff.
Comments
Once the supply and demand level off, shipping product via container ship is dirt cheap. Apple is a logistics machine.
That's more expensive than even the new MacBook.
Those iPhones would be for export, so I assume wouldn't incur those same tariffs, assuming tariffs are on finished products shipped into the U.S. Market. I agree that is doesn't make much sense if it adds costs to the Canadian Markets.
But seriously, let’s see…property taxes, energy costs, environmental regulations, cost of constructing the factories, retooling the assembly lines every year for new iPhone models, cost of shipping the parts and raw materials across the Pacific (could be higher than the cost of shipping the resulting final product), inventory cost for keeping enough parts/raw materials in the US to account for any disruptions in the trans-Pacific supply chain, waste disposal costs. And of course, even with robots you’d still likely need far more skilled labor to run and maintain the factories than is readily available in the US.
In all likelihood, by the time Apple could build the factories, train the staff and begin production, Trump would no longer be President. So would it be better to just ride it out?
The above statement is correct. What rarely gets said is that doing it also makes all of our (your) people poorer ('cos the goods just got more expensive). You pays your money and you takes your choice.
As far as the foreign workers are concerned, history suggests that doing cheap manufacture is on the national development route to better things. I remember when Japan was the centre of cheap manufacture and then it was S. Korea. They outsource to China now.
http://www.apple.com/au/shop/buy-iphone/iphone-7/5.5-inch-display-256gb-black#01,11,22
1). The Chinese robots are just the base models whereas the American versions need to be fitted with cowboy hats.
2). When the American Skynet software gains self-awareness and goes on a global genocidal killing rampage research has shown that costs can rise considerably.
Hope this helps.
What then, a world-wide Trade War?