Why Apple Got a "Made in U.S.A." Bug | Hacker News Reader

Why Apple Got a "Made in U.S.A." Bug

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37 pointsshrig9438 comments

Shouldn't we all wait and see what they actually do vs. marketing hype?

If they only make a dozen jobs for supervisors and the rest is machine automation, does that count?

What if it's in a US territory to escape minimum wages and standard benefits? Does that count?

What if no-one works more than 29 hours a week to dump the health costs on taxpayers instead of Apple? Does that count?

What if all the machines, tools, parts, building materials used in the facility were made outside the USA? Does that count?

What if it's in a US territory to escape minimum wages and standard benefits? Does that count?

The minimum wage in all US territories was recently raised to the US minimum wage in increments of $0.50/year, starting in 2007.

It's one of those rare cases where a min wage increase had any effect at all - usually min wage increases go from WAY below market to simply below market.

This article shows what Apple hopes to gain from the announcement that they will be manufacturing in the U.S. - articles about Apple planning to manufacture in the U.S.

I remember Walmart's "Buy American" campaign in the late 80's early 90's. Ten to fifteen years later it still shaped perceptions about the company's merchandise long after it had gone to a global logistics chain. I wouldn't be surprised if Mr. Cook has made a similar observation.

Apple's investment is trivial. $100,000,000 is still small business in American manufacturing. It's about the cost of a new moderately sized High School.

Exactly. Isn't it a little suspicious that it's for a product segment that's waning in popularity and profitability? I won't be surprised if in three years the line is killed and the factory is closed.

You know, as a European who used to live in China I have to say that those 'Made in the USA' slogans are really off-putting for me.

To me it almost reads like 'More expensive because we're jingoists'.

Whatever happened to globalization? Has it become hip to be 'protectionist' now the economy isn't doing so well?

This really does bug me because the companies that use the 'Made in the USA' tagline otherwise tend to be cool (it's all over Kickstarter).

I think you're missing the point. Domestic production is very important if we want to keep our living standards while accounting for the ecological costs of our consumerism. 'Made in the USA' is just a label to sell American consumers on, but the reasonings are deeper than jingoism. Sooner or later our greenhouse gas output is going to bite us in the ass and for that we need new solutions. For the Chinese economy I'm not concerned, since they're growing into a huge domestic market themselves. Luckily they also seem to understand the ecological dangers, thus they're beginning to invest quite heavily in clean energy.

P.S. I'm European. I have much more hope for the USA to turn around their economy however. Long term Europe is in a much tougher position to compete in the new global economy, mostly because we have no silicon valley and we have hardly any top tier universities that churn out massive amounts of startups. On the other hand what's very worrysome about the US are the exploding cost for academic degrees - that's gonna hurt really soon when a whole generation of high potential people (a) aren't able to get a degree or (b) get a degree but can't spend any money on consumer products because of their loans. However - this as well as medical care is fixable in mid term. Not having a culture of innovation is much tougher.

...but the reasonings are deeper than jingoism.

Could you explain the reasoning? Your post is very unclear unclear what greenhouse gas output has to do with American manufacturing.

When big consumer brands launch a new mobile product they often book all the available air cargo space they can. Chinese manufacturing has lead to an explosion of air as well as ship cargo, thus adding tons of CO2 cost to your products. That's were domestic manufacturing would safe you.

I seriously doubt the CO2 emissions of shipping an iPhone are remotely significant. In fact, I'd bet at even odds that driving a car to the Apple store emits more CO2 than shipping the iPhone from China.

I couldn't agree more with your post scriptum!

The ecology argument makes sense, of course, insofar more of the sales are in the US than Asia. Nonetheless, it seems to me that it's usually more of a convenient side-effect than the actual motivation. But thanks for your perspective.

Some of the Kickstarter project take manufacturing to an extremely local level. In the project description it will say that their costs are higher because the designers want everything to be manufactured in their hipster town. I feel really uneasy about such sentiments. (And mind you, people call me a hipster all the time.)

As for the Chinese economy, I try to be optimistic. However… The housing market seems really unhealthy. You'll pay more for an apartment in a not-that-great neighborhood in Beijing than for one in an awesome neighborhood in the capital of many European cities. Meanwhile, the quality of the Beijing apartment will leave much to be desired and the building is actually built on land that is merely leased from the government! Consumerism is crazy too. Did you know that on China's Single's Day (one of the many holidays in China invented by marketeers) sales were higher than on the US's Black Friday?

Finally, the Chinese definitely don't care about the environment. It's not in their mindset at all. Everyone wants to drive an SUV (while public transportation is dirt-cheap), the amount of plastic packaging they use is insane, the only recycling is done by homeless people who collect plastic bottles from trash cans, etcetera.

USA-made goods have a reputation for better quality than China-made goods. Not as much in the tech world, where top-of-the-line iWhatever is made in China, but, for example, in the world of mechanics and tradesmen, Chinese goods = Harbor Freight, cheap but low quality, while American goods are pricier but probably good enough to do the job.

Not just better quality, but an honest product. Waves of toxic toys, rotting drywall, and deadly dog food from China have seriously damaged the Chinese brand in the US.

I understand that China has those problems you mention, but as you say, they don't apply to tech products that much.

Does anyone really want to buy 'Made in the USA' products because they're afraid their Macbook or expensive designer clock is going to fall apart if it's made in China?

Thanks for your input. I find it very interesting that so far no one has said that it's about protecting national interests and that they're all for that!

Everybody knows what they're getting when they buy a Macbook, but not every product is familiar as a Macbook, and not every brand is as concerned with protecting their reputation as Apple. The existence of Chinese-made Macbooks proves that the Chinese are capable of making good products, but it doesn't prove that they habitually do so. With a lot of products, you're not going to find many reviews online, and even if you do, you don't know if the product has changed since the reviewer purchased it (unlike the situation with Macbook, where we read about it on HN every time there's a refresh).

Here's an extremely long thread at a website for toolheads that attempts to address this issue by reviewing harbor freight tools (mostly cheap no-name Chinese imports), but it's a long way from solved. The sheer size of this thread gives you an idea of how many people face the dilemma of buying cheap, risky products or expensive safe products. http://garagejournal.com/forum/showthread.php?t=27192

Often, you're forced to rely on the reputation of the country of origin or the brand (and the good brands are mostly American, European or Japanese).

That said, I have bought some Chinese made no-name products that turned out to be perfectly good for a much lower price than their USA-made counterparts.

It's a double-edged sword: global labour arbitrage has resulted in massive increases in quality of life for the average Chinese, but people look at the QOL in China and think, "I'm facilitating slavery by buying foreign goods". What these people really want, in an ideal world, is for there to be no inequality between various national markets. This is happening slowly, but like any inequality, it will gradually even out over time.

Businesses look at both halves of that problem and see

a) we have to pay more to manufacture things in China, and the cost is going up

b) people don't want to buy things made in China, even though the price is going up, because they still sense inequality

and so they tentatively start bringing some production back. This trend will likely speed up ( especially, as this article says, for large goods that are more expensive to ship and easier to assemble ) as Chinese wages rise.

I dunno. I see 'Made in Europe' becoming more prevalent in products mfgd in Europe. I don't feel off-put by that. So, I think it's more your personal reaction.

Mfgs mfg where they do because it's advantageous, one way or another. They very rarely do it for political reasons; overwhelmingly it's due to economic/strategic reasons, AFAIK.

W/re Kickstarter, I wonder if there's any bleeding effect from the 'consume local' food movement to the durable goods sphere. Maybe it's just coincidence, altho there seem be some parallels.

Maybe Apple actually plans to assemble iTVs in USA; it would probably make the most sense. Unit sizes are huge, most customers are domestic, keeping it more under the wraps etc...

Tim Cook said it would be one of the Mac lines.

I'd put a wager on it being the 2013 refresh of the Mac Pro.

That makes sense. It would be a good way to get started considering the relatively low demand for Mac Pro's they could presumably assemble all of them in the USA (therefore all customers get the same product).

The post losts all credibility as soon as the quote from Rob Enderle showed up.

Yep. Closed the tab when I got to that.

Enderle? Sigh.

I wonder if the writer realizes that Steve Jobs started out using robot factories (with NeXT) and then went to China. Its cheaper to hire and fire poor people than robots.

My guess is that Apple plans to assemble the most expensive macs (especially Bro models) in the US. I'm hopingthis includes the Mac Pro replacement.

Either labour costs are cheaper (the Chinese are starting to want real money vs many unemployed people in the us) or they're getting a tax break somewhere or a subsidy.

doesnt matter how much Chinese want , china is an infinite source of cheap labour. And you forget something, you cant freely work where you want in China. You cant just quit your job and find another one, you need an authorisation to do so. Some forget that China is still a centralized communist country.Their economy is still highly planified and there is no difference between government and "private" sector. they are the same entity.

> Some forget that China is still a centralized communist country.

China was never a centralized communist country - it was a country that attempted to create a state-capitalist economy, to varying degrees of success over the years.

This isn't a matter of quibbling over terminology; it's a rather important distinction to be aware of for anybody who wants to understand modern China's economic history.

The New York Times quoted Rob Enderle? Whoa.

> Groklaw is an Anti-SCO FUD propaganda site

http://web.archive.org/web/20040928043900/http://pl.caldera....

Earlier things in the speech were said obviously tongue-in-cheek but the title of the talk that quote is from is "Free Software and the Idiots who Buy It" and it was the keynote at SCO Forum August 3, 2004.

Just in case anyone else's memory was as rusty as mine is.

There probably is a political motive that involves government or military contracts here. Or an political/economic motive if Apple wants to repatriate money back into the US.

It isn't necessarily labor costs that will likely keep at least some component manufacturing overseas. Semiconductor fabrication involves a lot of nasty chemicals and byproducts. Fab plants are substantially cheaper to run in countries with lax worker safety and environmental standards.

Tim Cook thinks different though ;). He also re-instated the charity giving.

Either way, even if Apple makes a few dollars less on each Mac the publicity alone is worth it. "Look, we make things in USA." Remember BP's, Beyond Petroleum?

--- edited to add "less"

As long as people don't think iPhones and iPads will be made in US, because that would just be misleading. I assume most of the components will still be made abroad anyway, and just the assembly in US, which again makes it kind of misleading to say it's "made in US", if 90% of it is made elsewhere.

Globalization distributes the chains of production enough that most "made in X" statements just mean "assembled in X."

Indeed. As Tim Cook stated in the interview w/ Brian Williams, even the "made in China" iPhone has an American-made System-on-a-Chip and Gorilla Glass.

Maybe Apple's use of the label 'Assembled in ...' and not 'Made in ...' had this possibility in mind.

It's pretty naive to assume that Apple is going to eat the added costs of US manufacturing instead of just building it into the price, ala Nexus Q.

They've probably got enough good will out of all the misleading coverage to cancel out the $100M they're planning to spend already.

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