What potential countries might be the locations that it gets moved to?
>The countries being considered include Mexico, India, Vietnam, Indonesia and Malaysia. India and Vietnam are among the favorites for smartphones, Nikkei said, citing sources who did not want to be identified as the discussions are private.
"Apple's India Move Is Risky, But Better Than Facing Trump's Trade War"
https://www.forbes.com/sites/davidvolodzko/2019/01/17/will-a...
iPhone assembly in India started a few years ago, with Wistron and more recently, Foxconn, setting up facilities. So far these two assemble only the older models, and the volumes may not be very high. But they will accelerate the pace since Apple cannot have local stores, due to regulations, unless it sources at least 30% locally. It’s been trying to negotiate better terms with the government, but hasn’t seen much success since many other smartphone makers have facilities here (the government once said it would not provide preferential treatment to anyone).
Next year (2020) or 2021 may be the year when flagship iPhones are assembled in India, even if volumes are lower.
https://www.amazon.com/How-Rich-Countries-Poor-Stay/dp/18452...
As India becomes wealthier and if Apple can move production of all of their models there relatively soon that should set them up nicely to capture a larger chunk of that market.
India should have encouraged manufacturing and assembly of semiconductors and electronics a long time ago, but successive governments didn't do much about it with urgency. The infrastructure for this is quite weak (especially in comparison to China and Taiwan). Add to this issues with electricity (there are periodic power cuts in most cities) and other infrastructure issues, it's more difficult for companies to get things done. That's where companies like Foxconn, which have had a presence in India to assemble computers and other accessories, have an advantage in ramping up.
After crude oil imports, the import of electronic goods stands second (or sometimes third, after gold) in terms of foreign exchange outgo and the current account deficit. This is a huge problem for the government. In the last two decades, India has achieved a lot, mainly through the private sector, on mobile phone usage penetration, and India has the lowest (or one of the lowest) cellular plan pricing in the world. But it still lags on other related fronts, like great devices to take full advantage of the network and the Internet while remaining secure. High import tariffs on these products make them inaccessible to most people, and they have to make do with cheaper and inferior products. So I personally don't support high tariffs on products that can accelerate the way people connect and what they can achieve.
From the article, Mexico, India, Vietnam, Indonesia, Malaysia:
> The countries being considered include Mexico, India, Vietnam, Indonesia and Malaysia. India and Vietnam are among the favorites for smartphones, Nikkei said, citing sources who did not want to be identified as the discussions are private.
- Distribution and Shipping efficiencies
- Higher levels of productivity and training efficacy
- Nationalistic sentiment and contra-beneficial protectionism
“National sentiment” isn’t going to lower wages to $2/hr
The auto manufacturers make it work. Japanese, German, and Korean car makers all have factories in the U.S.
https://9to5mac.com/2019/01/28/apple-mac-pro-screwed/
You won't be facing these kinds of delays in China.
On day one, China has this advantage.
But on day 300? It's not like there is no company in the United States That can ever make the matching screw.
Good luck merely getting registered as a new vendor for anything a multinational company makes.
Let alone winning a tender.
Also known as speculative wishful thinking
I’m not blind to the challenges but also expect the current economic and political situations aren’t going to just go away over night. This will make decisions which make not make sense today potentially more attractive in the future.
https://www.vox.com/2017/5/26/15656120/manufacturing-jobs-au...
Perhaps you won’t have Americans assembling phones, but for sure you’ll have them maintain the assembly machines and supervising.
I hope otherwise, but an unhappy alternative forecast would be "Perhaps you won't have Americans assembling phones, but for sure a few people will own all the machines that do so"
The entire history of technological progress that has brought more people out of poverty is of better and more automated agriculture and manufacturing and distribution.
Things become more efficient in the use of resources over time. Automation aids in that by reducing wastage.
Yes Apple shareholders might own the machines that make iPhones, but people working, doing service activities that can't be automated, they will be buying them. If there's no one to buy, there won't be any reason to make them.
Absolutely agreed. But previous technical progress has moved the bulk of people from one repetitive task (farming) to another (manufacturing).
It is a great goal to eliminate dreary jobs, but if the current process does not create new repetitive jobs but eliminates that category of task in favor of high skill tasks, then there is going to have to be some mechanism to impart those skills.
During previous technical revolutions, there was no effort to do so and luckily the new jobs could be learned in minimal time. But these are the exact jobs that are going to disappear now. And ironically people are becoming more skeptical of universities not less.
So yes, it is a great goal to eliminate low skill jobs, but assuming some invisible force will give everyone a challenging job that they can do is perhaps magical thinking. Consider: if you tell a factory worker that his job will be automated away, he is not relived by it but panicked. If it is an improvement for him, one has to ask why.
> If there's no one to buy, there won't be any reason to make them.
This is what caused of the great depression: concentration of wealth away from consumers who drive the economy and into a tiny number of hands. If it's just one company or even sector that fails then it's just a bump. If it's widespread or systemic then it's a disaster.
I'm watching all this with great interest. Everyone thinks Vietnam is some third world poor country, but the reality is that there is massive amounts of money here. Hai Phong in the north is a HUGE port. Samsung already makes about 80% of their phones in this region and it is only growing as Trump drives huge amounts of investment.
It is very easy to get goods shipped over from China (I've driven the backroads and seen it myself). Assembled in Vietnam. Shipped out of Hai Phong, and totally avoid the tariffs.
Also look at what is happening in Sihanoukville, Cambodia with Chinese taking over the entire city. It is a major shipping point. Very interesting times indeed!