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How is moving manufacturing to the USA going to protect against China developing expertise in design and software? Also the whole made in China panic is overbl

by simonh 6y ago

How is moving manufacturing to the USA going to protect against China developing expertise in design and software? Also the whole made in China panic is overblown. Most of the value in the parts in an iPhone is sourced outside China. CPUs in Taiwan (used to be Texas), flash memory in Korea, Japan and the US, camera module in Japan, Gorilla Glass in Kentucky, Japan and Korea etc, etc. Final assembly is only worth a few bucks per phone. It's fighting over scraps. I just don't see how reversing the relationship - design and software in China, final assembly in the US, is going to benefit the US all that much.

someperson 6y ago
If Samsung can manufacture 80% of their smartphones in Vietnam on 300 million smartphones, I can see why Apple couldn't move all their manufacturing to Vietnam and India.
- simonh 6y ago
  I agree, that makes a lot more sense. Not so sure about India though, that's just to avoid punitive Indian import taxes. It would make little sense for export.
cageface 6y ago
It doesn't prevent China from developing expertise. That's inevitable. It prevents the US from falling dramatically behind.
- simonh 6y ago
  Falling behind on what? Low end assembly line work at the very bottom of the value chain just isn't worth fighting low skilled workers from rural China or Vietnam over. The chances are all of that will be done by robots soon anyway, which is a whole new ball game.
  - 10000truths 6y ago
    It’s “low end” right up until you have no access to it. When it comes to national security, you don’t want to be in a position where the majority of your manufacturing output is at the mercy of a foreign country’s blessing. Your R&D is worth nothing if you can’t actually build.
    - simonh 6y ago
      That boat sailed a long, long time ago. The era where any country, even a giant like the US can make everything and be entirely self sufficient is long gone. What kind of future would realistically result in no access to foreign manufacturing or resources? If the risk is seen as China particularly, they only do the lowest value lowest skilled work. Pretty much by definition that's the easiest to relocate. Samsung does most of it's phone manufacturing in Vietnam. Apple has assembly lines in Brazil and India. Yes they're vulnerable to short term pain, but even the recent trade war didn't come even close to the kind of massive economic death struggle that would lead to cutting off access to basic manufacturing. If we end up in an actual war, we'll have more to worry about than not getting the latest iPhone for a few years.
      - nicoffeine 6y ago
        > If we end up in an actual war, we'll have more to worry about than not getting the latest iPhone for a few years. This is a supply issue with silicon/electronics in general. At this point, it would be more of a disaster for any country to lose access to electronics than to oil. I'm not sure where you heard that manufacturing electronics is low skill, but I definitely don't agree. The point is that there's no difference between the US and some country that has oil resources but no refining capacity. We can dig silicon out of the ground but we can't make anything with it. The other thing you may be failing to consider is automation. If another economy gets there first, they won't be just building chips. If you're afraid of China becoming the fastest at bringing technology ideas to market, we are already there. And not just some ridiculously useless SV "x but for uber" product. A real piece of reality that turns on and can perform work. This is even before you get into the national security argument about a trustable supply chain.

by simonh 6y ago

someperson 6y ago

If Samsung can manufacture 80% of their smartphones in Vietnam on 300 million smartphones, I can see why Apple couldn't move all their manufacturing to Vietnam and India.

simonh 6y ago
I agree, that makes a lot more sense. Not so sure about India though, that's just to avoid punitive Indian import taxes. It would make little sense for export.

cageface 6y ago

It doesn't prevent China from developing expertise. That's inevitable. It prevents the US from falling dramatically behind.

simonh 6y ago
Falling behind on what? Low end assembly line work at the very bottom of the value chain just isn't worth fighting low skilled workers from rural China or Vietnam over. The chances are all of that will be done by robots soon anyway, which is a whole new ball game.
- 10000truths 6y ago
  It’s “low end” right up until you have no access to it. When it comes to national security, you don’t want to be in a position where the majority of your manufacturing output is at the mercy of a foreign country’s blessing. Your R&D is worth nothing if you can’t actually build.
  - simonh 6y ago
    That boat sailed a long, long time ago. The era where any country, even a giant like the US can make everything and be entirely self sufficient is long gone. What kind of future would realistically result in no access to foreign manufacturing or resources? If the risk is seen as China particularly, they only do the lowest value lowest skilled work. Pretty much by definition that's the easiest to relocate. Samsung does most of it's phone manufacturing in Vietnam. Apple has assembly lines in Brazil and India. Yes they're vulnerable to short term pain, but even the recent trade war didn't come even close to the kind of massive economic death struggle that would lead to cutting off access to basic manufacturing. If we end up in an actual war, we'll have more to worry about than not getting the latest iPhone for a few years.
    - nicoffeine 6y ago
      > If we end up in an actual war, we'll have more to worry about than not getting the latest iPhone for a few years. This is a supply issue with silicon/electronics in general. At this point, it would be more of a disaster for any country to lose access to electronics than to oil. I'm not sure where you heard that manufacturing electronics is low skill, but I definitely don't agree. The point is that there's no difference between the US and some country that has oil resources but no refining capacity. We can dig silicon out of the ground but we can't make anything with it. The other thing you may be failing to consider is automation. If another economy gets there first, they won't be just building chips. If you're afraid of China becoming the fastest at bringing technology ideas to market, we are already there. And not just some ridiculously useless SV "x but for uber" product. A real piece of reality that turns on and can perform work. This is even before you get into the national security argument about a trustable supply chain.