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Comment by crazygringo | Hacker News Reader

Brazil is an exceptional case because of their import tariffs which are far, far higher than any other country in the world.

From the linked article:

"with domestic production of the iPhone and iPad providing a means by which Apple could avoid hefty import taxes in one of the world's most populous countries. "

I don't know any of the details, but I would assume Foxconn is performing the absolute minimum level of assembly necessary to meet "domestic manufacturing" requirements. So it is in no way an effective counterexample.

Plus, Brazilians are used to long supply-chain delays (like major supermarkets in major cities running out of Diet Coke or Ruffles) in a way that Americans will not put up with. Something tells me Foxconn's Brazilian factory may not be too different.

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> I don't know any of the details, but I would assume Foxconn is performing the absolute minimum level of assembly necessary to meet "domestic manufacturing" requirements. So it is in no way an effective counterexample.

It's absolutely a counterexample. The iPad is assembled in China, but its parts are from all over the world. Now it's also assembled in Brazil. The supply chain in China isn't critical to the iPad's assembly, just critical to the iPad's assembly at the current profit margins. Despite the hot air in the article, you could absolutely manufacture iPads in the US. Much like Brazil they would cost more, but that's not what the article was talking about, it said they can't be made anywhere else. That's bullshit, proven by Brazil.

I think that all that is going on with Brazil is that it's a miniature replica of the Foxconn plants in China, and as been mentioned numerous times, it's only because it would be MORE expensive to make them in China (however inexpensive) and ship to them to Brazil than to deal with an inflexible supply chain in Brazil and make them there. Even factoring in demand and supply volatility. If things don't go well for the plant, on the world scale, it's only Brazil. All of these were factored into the decision to build them there.

China is responsible for making every iPad in the world outside of Brazil. You can't assume the same amount of risk for that scale. If a component goes bad or if demand skyrockets, you want as many responsive factories around as possible to pick up the slack or to get you new components. Why wouldn't you want to locate your supply chain in China? Only if you have a situation that looks like Brazil--high import tariffs.

Correct. The retail price of imported consumer electronics in brazil is literally double that of the U.S.

I recall from another article that Apple requires 9,000 engineers to oversee the production of the iPhone. It is not that the USA has fewer than 9,000 engineers, but you would be lucky to find one engineer that is unemployed, let alone 9,000 of them. China, on the other hand, and perhaps Brazil, has engineers looking for work.

Nothing is insurmountable with enough time and effort, but demonstrating that Brazil can easily accommodate a factory says nothing about the ability of doing the same in the USA.

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