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Exactly this. The US could make iPhones too, but we import them. Unfortunately we don't have a "strategic iPhone manufacturing reserve", so we have to keep it c

by rib3ye 5y ago

Exactly this. The US could make iPhones too, but we import them. Unfortunately we don't have a "strategic iPhone manufacturing reserve", so we have to keep it cool with China.

mrcwinn 5y ago
I do, however, have a strategic reserve of fitness wearables in a kitchen drawer. I am standing by.
Atlas667 5y ago
Apple could not make I Phones in the US. The cost of living is too high. Either you bring the cost of living down or you make technology incredibly more productive. Which in itself make the price of the product go down and generates less profits as a tendency. Think of the shareholders my man, what would they do without?
- stjohnswarts 5y ago
  At their current level of production? Nope, US doesn't have the capacity. Give it 3 or 4 years, probably, at an elevated cost.
- actuator 5y ago
  Apple has enough margins to make the phone in US. They make it outside to increase their profits.
  - ramraj07 5y ago
    Which market research document did you get this factoid from? Many have gone on record and said even if they wanted to make them here the engineer volume and expertise are nowhere to be found except in China now. The speed with which they can deploy factories for new processes in China is unprecedented. You can’t match that here in the US. It’s not apples mistake, it’s the governments. And the people who vote for them. Which includes you if you’re American (and sitting in a liberal state voting democrat doesn’t count; if you care that much move to a swing state and vote there).
    - nwiswell 5y ago
      > Many have gone on record and said even if they wanted to make them here the engineer volume and expertise are nowhere to be found except in China now. The speed with which they can deploy factories for new processes in China is unprecedented. You can’t match that here in the US. This is circular reasoning. We can't make them here because we don't. Yes, obviously it would take time to build capacity, but it's silly to argue China is fundamentally capable of something that the US is not. This is purely a question of cost (and, therefore, motivation). What should probably be countenanced, in my opinion, is "supply chain readiness": make _some_ of the iPhones domestically, so that if it becomes necessary, it is much faster to ramp domestic production. That hurts profits in the short term, but it probably does enhance long term expectation profits (conflict with China is less disastrous). Unfortunately Wall Street is notorious for its emphasis on the short term -- and that has next to nothing to do with politics.
      - chii 5y ago
        The US can't make iphones the same way that China can't make their own Silicon Valley (god knows they've tried - they ended up with Shenzen, which to be fair, is called the Silicon Valley of electronics).
      - LordDragonfang 5y ago
        >Unfortunately Wall Street is notorious for its emphasis on the short term -- and that has next to nothing to do with politics. While it may not originate from politicians, politics and corporate short-sightedness have been so tightly coupled since at least the Reagan admin that distinguishing the two is arguably missing the forest for the trees. But yes, the root problem is the people controlling the levers of Capital for short-sighted greed, as is often the case.
        stjohnswarts 5y ago
        Crony capitalism and current US politics are deeply rooted into each other and feed and nourish one another.
  - moonchrome 5y ago
    Where have you been for the last two years? If it was just a matter of margins we wouldn't have world wide shortages of components, production lines shutting down, etc. Even with massive multibilion investments in fabs all over the place it's going to take years to bring up fab capacity - in the ideal case. And that's just for one component. Apple doesn't even do manufacturing anyway - they outsource every step of the way. What US alternatives are there to Samsung displays or Foxconn assembly ? Apple is too high up the chain to bring about this kind of change, best you could probably do is US assembly if you imposed India like tariffs. Not sure how the US consumers would feel about their iPhone jumping in price by 30%.
    - actuator 5y ago
      Systematic destruction of industrial capacity is not fixed in a single year. Even the outsourcing of capacity to PRC, didn't happen in a single year. It happened slowly motivated by margins, not due to some technical breakthroughs that were happening in PRC. > Apple doesn't even do manufacturing anyway - they outsource every step of the way. That's again a conscious choice because of margins. Apple used to manufacture stuff themselves in US. No one is saying Apple has to make display tech as well. Buying stuff from allies like SK, Japan and Taiwan shouldn't be an issue. > Not sure how the US consumers would feel about their iPhone jumping in price by 30%. Last I checked Apple had over 40% margins on their iPhone. If Apple shared the same concerns as their parent country, they wouldn't work to maximize their profits, even if it comes from labour working in inhumane conditions. The systematic destruction of US industrial capacity has been in chase of profits.
      - erosenbe0 5y ago
        I'd argue capacity was not 'outsourced' as American manufacturing never had the kind of capacity seen in Asia. Modern Asian manufacturing scales up faster than USA has ever done outside of WWII. Large numbers of infrastructure and people.
    - copperx 5y ago
      > Not sure how the US consumers would feel about their iPhone jumping in price by 30%. Apple sells iPhones in Mexico at 30% over the US price and you still see iPhones everywhere, even considering the purchasing power of the average Mexican is about 1/10 of an American.
  - kwere 5y ago
    it would cost 100s billion $ of capex to "copy" eastern supplies and still fail commercially without tariffs on a quasi-global scale
- eloff 5y ago
  It's less about cost of living and more about the fact that all the expertise and parts all the way through the supply chain are in Asia. Bringing that industry to the US requires bringing many of the supporting industries too. It's no simple task and probably won't happen at this point.
  - landemva 5y ago
    People expertise can be hired. That doesn't overcome the pollution allowances other countries have. It's cheaper and easier to pollute over there.
    - eloff 5y ago
      Is iPhone production very polluting? I don't think that factors into it very much really. More cost of labor, proximity to suppliers, and domain knowledge.
      - landemva 5y ago
        Chemical etching, perfluorocarbons, and massive water consumption is cheaper where pollution regulations are weak. Most of the lines are automated, so labor costs of a running line aren't the big cost issue. Environment and human health have few protections over there. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC1566445/ https://www.ncbi.nlm.nih.gov/pmc/articles/PMC1566445/
  - shagie 5y ago
    ... and the logistics of getting those parts. Everything you need to build an iPhone is in one city. This is quite a bit like Detroit of the 50s - where the manufacturer and the entire supply chain for it is geographically compact. Today, it is hard to find a geographically compact industrial chain within the US. http://free.sourcemap.com/maps/57d154a89ca3b16d44e95e5e http://free.sourcemap.com/maps/57d154a89ca3b16d44e95e5e Compare that to, say, the supply chain for the Ford F150 - https://open.sourcemap.com/maps/582b47c785e240e442569015 https://open.sourcemap.com/maps/582b47c785e240e442569015
- erichocean 5y ago
  Apple has said they could build iPhones in the US, but the cost would be $7 more per iPhone (when they studied it years ago).
  - morelisp 5y ago
    This is completely implausible. In 2016 final assembly alone was estimated to go from at least $10 to $30, ignoring fixed overhead and training. https://www.technologyreview.com/2016/06/09/159456/the-all-american-iphone/ https://www.technologyreview.com/2016/06/09/159456/the-all-a...
- bin_bash 5y ago
  Not according to Tim Cook: > There's a confusion about China. The popular conception is that companies come to China because of low labor cost. I'm not sure what part of China they go to, but the truth is China stopped being the low-labor-cost country many years ago. And that is not the reason to come to China from a supply point of view. The reason is because of the skill, and the quantity of skill in one location and the type of skill it is. https://www.inc.com/glenn-leibowitz/apple-ceo-tim-cook-this-is-number-1-reason-we-make-iphones-in-china-its-not-what-you-think.html https://www.inc.com/glenn-leibowitz/apple-ceo-tim-cook-this-... Of course, he would say nice things about China like this so I take it with a grain of salt myself.

by rib3ye 5y ago

Exactly this. The US could make iPhones too, but we import them. Unfortunately we don't have a "strategic iPhone manufacturing reserve", so we have to keep it cool with China.

mrcwinn 5y ago

I do, however, have a strategic reserve of fitness wearables in a kitchen drawer. I am standing by.

Atlas667 5y ago

Apple could not make I Phones in the US. The cost of living is too high. Either you bring the cost of living down or you make technology incredibly more productive. Which in itself make the price of the product go down and generates less profits as a tendency. Think of the shareholders my man, what would they do without?

stjohnswarts 5y ago
At their current level of production? Nope, US doesn't have the capacity. Give it 3 or 4 years, probably, at an elevated cost.
actuator 5y ago
Apple has enough margins to make the phone in US. They make it outside to increase their profits.
- ramraj07 5y ago
  Which market research document did you get this factoid from? Many have gone on record and said even if they wanted to make them here the engineer volume and expertise are nowhere to be found except in China now. The speed with which they can deploy factories for new processes in China is unprecedented. You can’t match that here in the US. It’s not apples mistake, it’s the governments. And the people who vote for them. Which includes you if you’re American (and sitting in a liberal state voting democrat doesn’t count; if you care that much move to a swing state and vote there).
  - nwiswell 5y ago
    > Many have gone on record and said even if they wanted to make them here the engineer volume and expertise are nowhere to be found except in China now. The speed with which they can deploy factories for new processes in China is unprecedented. You can’t match that here in the US. This is circular reasoning. We can't make them here because we don't. Yes, obviously it would take time to build capacity, but it's silly to argue China is fundamentally capable of something that the US is not. This is purely a question of cost (and, therefore, motivation). What should probably be countenanced, in my opinion, is "supply chain readiness": make _some_ of the iPhones domestically, so that if it becomes necessary, it is much faster to ramp domestic production. That hurts profits in the short term, but it probably does enhance long term expectation profits (conflict with China is less disastrous). Unfortunately Wall Street is notorious for its emphasis on the short term -- and that has next to nothing to do with politics.
    - chii 5y ago
      The US can't make iphones the same way that China can't make their own Silicon Valley (god knows they've tried - they ended up with Shenzen, which to be fair, is called the Silicon Valley of electronics).
    - LordDragonfang 5y ago
      >Unfortunately Wall Street is notorious for its emphasis on the short term -- and that has next to nothing to do with politics. While it may not originate from politicians, politics and corporate short-sightedness have been so tightly coupled since at least the Reagan admin that distinguishing the two is arguably missing the forest for the trees. But yes, the root problem is the people controlling the levers of Capital for short-sighted greed, as is often the case.
      - stjohnswarts 5y ago
        Crony capitalism and current US politics are deeply rooted into each other and feed and nourish one another.
- moonchrome 5y ago
  Where have you been for the last two years? If it was just a matter of margins we wouldn't have world wide shortages of components, production lines shutting down, etc. Even with massive multibilion investments in fabs all over the place it's going to take years to bring up fab capacity - in the ideal case. And that's just for one component. Apple doesn't even do manufacturing anyway - they outsource every step of the way. What US alternatives are there to Samsung displays or Foxconn assembly ? Apple is too high up the chain to bring about this kind of change, best you could probably do is US assembly if you imposed India like tariffs. Not sure how the US consumers would feel about their iPhone jumping in price by 30%.
  - actuator 5y ago
    Systematic destruction of industrial capacity is not fixed in a single year. Even the outsourcing of capacity to PRC, didn't happen in a single year. It happened slowly motivated by margins, not due to some technical breakthroughs that were happening in PRC. > Apple doesn't even do manufacturing anyway - they outsource every step of the way. That's again a conscious choice because of margins. Apple used to manufacture stuff themselves in US. No one is saying Apple has to make display tech as well. Buying stuff from allies like SK, Japan and Taiwan shouldn't be an issue. > Not sure how the US consumers would feel about their iPhone jumping in price by 30%. Last I checked Apple had over 40% margins on their iPhone. If Apple shared the same concerns as their parent country, they wouldn't work to maximize their profits, even if it comes from labour working in inhumane conditions. The systematic destruction of US industrial capacity has been in chase of profits.
    - erosenbe0 5y ago
      I'd argue capacity was not 'outsourced' as American manufacturing never had the kind of capacity seen in Asia. Modern Asian manufacturing scales up faster than USA has ever done outside of WWII. Large numbers of infrastructure and people.
  - copperx 5y ago
    > Not sure how the US consumers would feel about their iPhone jumping in price by 30%. Apple sells iPhones in Mexico at 30% over the US price and you still see iPhones everywhere, even considering the purchasing power of the average Mexican is about 1/10 of an American.
- kwere 5y ago
  it would cost 100s billion $ of capex to "copy" eastern supplies and still fail commercially without tariffs on a quasi-global scale
eloff 5y ago
It's less about cost of living and more about the fact that all the expertise and parts all the way through the supply chain are in Asia. Bringing that industry to the US requires bringing many of the supporting industries too. It's no simple task and probably won't happen at this point.
- landemva 5y ago
  People expertise can be hired. That doesn't overcome the pollution allowances other countries have. It's cheaper and easier to pollute over there.
  - eloff 5y ago
    Is iPhone production very polluting? I don't think that factors into it very much really. More cost of labor, proximity to suppliers, and domain knowledge.
    - landemva 5y ago
      Chemical etching, perfluorocarbons, and massive water consumption is cheaper where pollution regulations are weak. Most of the lines are automated, so labor costs of a running line aren't the big cost issue. Environment and human health have few protections over there. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC1566445/ https://www.ncbi.nlm.nih.gov/pmc/articles/PMC1566445/
- shagie 5y ago
  ... and the logistics of getting those parts. Everything you need to build an iPhone is in one city. This is quite a bit like Detroit of the 50s - where the manufacturer and the entire supply chain for it is geographically compact. Today, it is hard to find a geographically compact industrial chain within the US. http://free.sourcemap.com/maps/57d154a89ca3b16d44e95e5e http://free.sourcemap.com/maps/57d154a89ca3b16d44e95e5e Compare that to, say, the supply chain for the Ford F150 - https://open.sourcemap.com/maps/582b47c785e240e442569015 https://open.sourcemap.com/maps/582b47c785e240e442569015
erichocean 5y ago
Apple has said they could build iPhones in the US, but the cost would be $7 more per iPhone (when they studied it years ago).
- morelisp 5y ago
  This is completely implausible. In 2016 final assembly alone was estimated to go from at least $10 to $30, ignoring fixed overhead and training. https://www.technologyreview.com/2016/06/09/159456/the-all-american-iphone/ https://www.technologyreview.com/2016/06/09/159456/the-all-a...
bin_bash 5y ago
Not according to Tim Cook: > There's a confusion about China. The popular conception is that companies come to China because of low labor cost. I'm not sure what part of China they go to, but the truth is China stopped being the low-labor-cost country many years ago. And that is not the reason to come to China from a supply point of view. The reason is because of the skill, and the quantity of skill in one location and the type of skill it is. https://www.inc.com/glenn-leibowitz/apple-ceo-tim-cook-this-is-number-1-reason-we-make-iphones-in-china-its-not-what-you-think.html https://www.inc.com/glenn-leibowitz/apple-ceo-tim-cook-this-... Of course, he would say nice things about China like this so I take it with a grain of salt myself.