“If presumptive Republican nominee Donald Trump prevails at the presidential election, he’s committed to making the US great again by forcing Apple to bring iPhone production back from China to the US,” Liam Tung reports for ZDNet. “So if he were actually one day able to follow through, how much would an iPhone cost and would it benefit the nation?”
“MIT Technology Review has run the numbers on three scenarios for the all-American iPhone, finding that Apple could profitably make the iPhone on its home turf without raising prices by that much,” Tung reports. “Jason Dedrick, a professor at the School of Information Studies at Syracuse University, estimates the cost of assembly would rise from about $10 per device to between $30 and $40 if Apple were to move that process to the US from facilities in China and Brazil.”
Tung reports, “If Apple were also to bring component manufacturing to the US, it would add another $30 to $40 to Apple’s costs, according to Dedrick, and the final price of the phone would rise at most by $100.”
Read more in the full article here.
MacDailyNews Take: “China provided engineers at a scale the United States could not match. Apple’s executives had estimated that about 8,700 industrial engineers were needed to oversee and guide the 200,000 assembly-line workers eventually involved in manufacturing iPhones. The company’s analysts had forecast it would take as long as nine months to find that many qualified engineers in the United States. In China, it took 15 days.” – The New York Times, January 21, 2012
Those jobs aren’t coming back.
And if they’d did make them only in America (or even the West in general) they wouldn’t be able to make anywhere near as many as quickly so would see a massive drop in revenue.
then they need to deal with that.
Why?
its not cost
Who’s gonna set up the assembly plant here, considering labor unions the main reasons factories had moved abroad.
They’ve moved because the corporate tax in the US is 35% and there are no tariffs to protect American workers like there are in China, Mexico, Japan and South Korea.
While the corporate tax rate may be 35%, NO ONE pays that much… the effective tax rate… the rate at which corporations pay tax is much, much, much lower… which is why we have gazillionairs, and the rest of us. For every dollar of tax they have managed to evade, that dollar represents an equal amount of not spent on building on infrastructure, or, at the very least, a dollar the rest of us have to pay…
According to a study by Aswath Damodaran, a finance professor at NYU, the average effective tax rate for computer companies is about 10%.
Not really. The main reason to move overseas is because the cost of workers is much less than here. Unions don’t enter into it at all: the cost of the lowest paid non-union worker here is still more than a Chinese assembler.
Another reason companies move overseas is to have a license to pollute more.
Most of the English speaking countries have sold out, at every level.
I’d pay that much more for an American made Apple iPhone.
Made in USA still means something.
as would I
Speaking as a representative of the rest of the world, Made in USA means nothing to me. Apart from a drop in quality and a vastly increased price that is.
So, no thanks…
fück China…America first.
Maybe Trump/Clinton and Apple can make a deal:
Apple agrees to make an American iPhone,
and Apple gets to bring all that money in Ireland back for a very low taxation rate.
That would more than offset the extra cost of making it here.
Corporations have a fiduciary responsibility to their shareholders to make them as much money as is possible. This not only involves moving production to countries that allow the corporations to maximize their profit margins as well as moving corporate headquarters away from US taxes; it means driving down real wages and removing benefits for workers still left in the US. Trump, who has failed at everything but real estate, and his record on that is marginal, obviously has no understanding of how capitalism works in America.
Too bad no one recalls that Henry Ford made Ford Motors great in the first place by paying his workers enough to buy the products they made and raise a family as well.
Good points.
The responsibility to shareholders also leads to short-term thinking, going for the quick profit. The CEOs are under pressure to show results in this quarter.
At least once, Tim Cook has warned investors not to buy Apple unless they are patient.
Sorry, but there is No fiduciary duty to maximize shareholder profit. The law on this is very clear.
So say the law books I have on my shelves.
Once again simplistic political dreck appears.
The idea of american workers producing manufactured goods on a scale that the far East is accomplishing is in fact a doable proposition.
American corporations (yes the private sector you all love) decided in the 1970s that manufacturing jobs were not as desirable as the “new” economy.
There is nothing economically standing in the way of creating American blue collar labor. The limiting factor is the 1% who would have to actually INVEST in America’s economy instead of sitting on the sidelines enjoying the fruits of venture capital and cronie capitalism.
There are two points here. Two sides.
One is to get America… America working and profitable.
The other is to keep Apple Profitable.
Is Apple profiting too much for Apple benefits?
Those who holding stock will say Trump is insane. Let Apple be. Well, Apple could run away to another country if it wished. Canada would be happy!!!!
Though this is a simplified article – it still states that the iPhone would cost an additional 100 bucks to produce… does that mean it would seem for an additional 100?
Or could Apple just decide to earn a little less?
But I am with Grandaddy on this one.
Does it matter? He’s not going to win.
And to all of you that blame the Unions for the moving of mfg overseas I have one thing to say. Where is your common knowledge of why unions were formed? They were formed because US Corporations took advantage of their employees, just like the companies overseas does. So give the jobs to people overseas that are underpaid and abused so you can save a few bucks while the corporations make billions. So those Union hating people out there mean to say ” I don’t care if people are abused as long as I save money”. Doesn’t say much for the moral fiber of the American Citizen. I would rather have the jobs over here and pay more than give my hard earned money to another country that is doing everything than can to destroy what Americans believe in.
Germany, France, Japan, Korea make a effort, the UK or the US no.
and of COURSE.. the by product of moving those jobs back on shore is more tax revenue from those good paying jobs… we all win.
Rhetorical question: Why should I, as an American citizen, be prevented from buying a product or service from another country? Would that not be impinging on my rights of liberty and the pursuit of happiness?
American Unions were formed to protect the rights of American workers that for many years were abused by the corporations, so they can show large profits. We American yell about fair labor in other countries but don’t care about americans and their jobs, just as long as they don’t have to pay more for their goods. The 1% is who runs this country and not the voter. If it was the voter we would have a Democracy not a Corpocracy. Don’t you read the papers or listen to the news about the sweatshops making goods for american consumption? Well if you don’t then you should! China steals our intellectual property and we reward them by giving them American jobs. I am an Apple/ Mac user and I hate that Made in America is not on their products. I would pay more to have Americans making our products, and Americans spending their money here and that money staying here.
Unions were formed to prevent abuse by corporations. In the end, they were abusing the corporations. Government unions are abusing taxpayers.
Apple has almost a quarter of a trillion dollars cash on hand. They ain’t passing any cost savings to us. In addition, this liberal run company is evading paying more in taxes.
The US is being economically gutted and effe’d. Wake up and stop it.
Apple revenue from China last quarter 2015: 12.5 Billion U$.
Moving iPhone assy. to US would raise prices in China and other countries more than in the US, and hurt the Chinese economy badly. China and the world would react, by buying much fewer iPhones. The iPhone business would be destroyed in the end. We are all in this world together. We are all brothers and sisters. The world wants to move in the direction of Oneness and Justice for all. The egoistic ideas of Donald Trump are contrary to the direction the world wants to go, and will lead to disaster.
Why should we Americans have the factory jobs? That’d be less time and energy innovating and therefore less advancements in tech.
MIT obviously did not account for the cost that unions would inject into the manufacturing process. By the time the government regs and union thugs finished with it, the price would be doubled and the phone would be doomed – not to mention the negative publicity Apple would endure regarding the strike lines outside the Saucer as business declined.
Or they go completely robotic.
This recurring meme of an issue repeatedly points out what a loud-mouth lout Donald Dumpf is. I’d very much enjoy ‘Made In America’ everything Apple. But it’s not going to happen, and Donald Dumpf is NOT being elected as the dictator of the USA, whether he likes it or not.
Not so sure about these figures, otherwise almost no high-tech equipment would be made in the US.
Which would leave manufacturers like Boeing, Lockheed-Martin, Airbus out in the cold, for a start.
On the other hand, is there an actual necessity for iPhone Production – as opposed to Concept, R&D, Marketing & Sales – to be completed Stateside?