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The end of Apple’s affair with China

economist.com

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Re: The end of Apple’s affair with China

#131

Post by bergenty »

yalogin wrote: post #122

The thing with outsourcing is, the vendor will themselves set up shop wherever the customer wants. In this case all the chinese companies are simply setting up plants in India and Vietnam, so they end up not losing any business in the short term. Same thing happens with software. All of the India consulting firms set up shop all over the world, for example Mexico to provide similar time zones to their US customers ye…

It makes a difference though. The Indian factories hire all Indian staff and this makes it resilient to any trade war issues that may arise between China and the U.S.

Re: The end of Apple’s affair with China

#132

Post by bergenty »

shubhamjain wrote: post #40

The cynical side of me senses that what would land with India and Vietnam is labor-intensive, commoditized assembly of parts. "X% of iPhones manufactured in India" is sort of misleading if the bulk of parts are still coming from China. In some ways, I think this is going China's way. They are moving up the ladder into specialized manufacturing and away from manual labor. A smart strategy considering the demographic d…

You need to start somewhere. I presume over time more of the components will be made closer to the factories where the phones are actually being manufactured.

Re: The end of Apple’s affair with China

#133

Post by MagnumOpus »

quesera wrote: post #66
bmer wrote: post #47

Earlier quoted context omitted.

Yeah, this makes sense to me. I have not read the linked article, but I wonder, does it discuss this? I caught another comment lower down that says the article mentions that labour costs in India are "only 2x" less than the labour cost in China. As if "only 2x" is "trivial"...

2x a small number is sometimes also a small number. I speculate that labor is not a significant contributor the cost to produce an iPhone.

More precisely, assembly labour is not a significant contributor.

There's labour in other parts of the chain that make up a big chunk of the cost - hardware design, software design, firmware, chip design, fabbinig, component manufacture, shipping, retail, warranty repair and whatnot, but those don't happen in China or India, so they won't change if the assembly location changes.

Re: The end of Apple’s affair with China

#134

Post by Kon-Peki »

makeitdouble wrote: post #37

I tried looking around to get how much of the iPhones are actually made in India and couldn’t find any clear information. Apple seems to be relying on Foxconn’s Indian subsidiary, and it is described as an assembly partner, so I’d expect all the parts and chips to be coming from neighboring countries (so mostly China?) It is still a pretty big deal, but my assumption would be that aside from the trumpeting headlines,…

My M1 Mac mini from 2020 says "Made in Malaysia" on it.

The diversification has been happening longer than many people believe.

Re: The end of Apple’s affair with China

#135

Post by kennend3 »

traceroute66 wrote: post #99
joezydeco wrote: post #75

Earlier quoted context omitted.

You're talking about turning a ship 10000x the size of the Titanic. A company like Apple with a CEO that built his career on logistics and production? You can be sure there's a plan. You just aren't allowed to see it.

> A company like Apple with a CEO that built his career on logistics and production? You can be sure there's a plan. You just aren't allowed to see it. This, this and THIS ! Do not underestimate Apple when it comes to supply chain management, they are the kings. Don't believe me ? Look at the COVID-induced semi-conductor shortage. Every other manufacturer out there that relies on a very strict definition of Just-In-T…

This really reads like your typical apple propaganda by non-paid apple employees which is really weird.

I got an Apple Ipad last year directly from apple.com, it took MONTHS to get it.

Apple's own site told me this, once i placed my order:

Shipment 1 Ships: 7-9 weeks

There are numerous stories about how it is faster to get a referb studio vs a new one?

> Apple work much much closer with their supply chain than the majority of other manufacturers out there.

Foxconn and such dont just supply Apple. It is odd to believe that apple is the only one working with them to get their stuff. What do the others do, sit around and wait? Not talk to foxconn at all?

Re: The end of Apple’s affair with China

#136

Post by coredog64 »

gjsman-1000 wrote: post #36
rapsey wrote: post #30

Earlier quoted context omitted.

> Also with the $200B in cash they had When exactly are you talking about? > $200B would buy at least 5 or more latest-gen chip plants, easily, or at least give TSMC all the capital they needed. $200B and a decade. Also do you think Taiwan is just going to let go of their biggest bargaining chip for a measly $200B? > If I was Tim Cook, I would have absolutely looked into segmentation. American manufacturing for Ameri…

> $200B and a decade. Also do you think Taiwan is just going to let go of their biggest bargaining chip for a measly $200B? Not necessarily a decade. Intel is promising ~4 years for their fabs, and hoping to be online by 2025-ish if I recall correctly. Fab production is also, it seems, going quicker than expected. > When exactly are you talking about? In 2018, Apple's cash pile hit $285 Billion. I was underestimating…

Intel already has plenty of fabs in the US. There are also a number of semiconductor companies with fabs in the US. They might not be as advanced as TSMC, but the infrastructure and workforce is already in place. What is lacking is a desire to dump a bunch of capital into fabs in an industry that has a history of severe boom/bust cycles.

Re: The end of Apple’s affair with China

#137

Post by kennend3 »

trap_goes_hot wrote: post #124
traceroute66 wrote: post #99

Earlier quoted context omitted.

> A company like Apple with a CEO that built his career on logistics and production? You can be sure there's a plan. You just aren't allowed to see it. This, this and THIS ! Do not underestimate Apple when it comes to supply chain management, they are the kings. Don't believe me ? Look at the COVID-induced semi-conductor shortage. Every other manufacturer out there that relies on a very strict definition of Just-In-T…

Is there any data for this? TBH, It doesn't pass the smell-test for me. Apple has a tiny product range, meanwhile companies like Samsung sell everything from chips, screens, and other components, to phones, laptops, tvs, etc, etc. Or even Dell, which has a massive product range; Our company purchased a ton of hardware from them during covid with no lead time issues - at-least on the things we wanted.

> Apple has a tiny product range

This is how apple manages supply chain issues.. By having a few products it is much easier to manage.

More so when many of your products dont change much year-to-year. How long has the ipad frame been the exact same size?

Re: The end of Apple’s affair with China

#138

Post by coredog64 »

hunterb123 wrote: post #71
Apocryphon wrote: post #65

Earlier quoted context omitted.

The Russian armed forces has had a lot of actual battlefield experience invading Georgia in the ‘00s, bombing Syria in the ‘10s, not to mention its internal bloody counterinsurgency occupation in Chechnya in the ‘90s. The Chinese military hasn’t fought a real war since against Vietnam in 1979, and its navy has had no experience at all since- Korea? The end of the civil war? War is entirely more uncertain for China, a…

The PRC constantly skirmishes with India and has land grabbed many islands in the South China Sea, many already occupied. Yes, since and during the communist takeover of China, all of its military might has generally been directed inwards at it's own people, but they are still a military force and are well organized. I'd equate the current period of the PRC to the Soviet arms build up of the Cold War.

What we’ve found out in Ukraine is that much of the military spending has been siphoned off by corrupt leadership. How do we know that the same thing isn’t happening in China?

Re: The end of Apple’s affair with China

#139

Post by Maursault »

gjsman-1000 wrote: post #36
rapsey wrote: post #30

Earlier quoted context omitted.

> Also with the $200B in cash they had When exactly are you talking about? > $200B would buy at least 5 or more latest-gen chip plants, easily, or at least give TSMC all the capital they needed. $200B and a decade. Also do you think Taiwan is just going to let go of their biggest bargaining chip for a measly $200B? > If I was Tim Cook, I would have absolutely looked into segmentation. American manufacturing for Ameri…

> $200B and a decade. Also do you think Taiwan is just going to let go of their biggest bargaining chip for a measly $200B? Not necessarily a decade. Intel is promising ~4 years for their fabs, and hoping to be online by 2025-ish if I recall correctly. Fab production is also, it seems, going quicker than expected. > When exactly are you talking about? In 2018, Apple's cash pile hit $285 Billion. I was underestimating…

> In 2018, Apple's cash pile hit $285 Billion. I was underestimating it.

Much has changed since 2018.

Apple cash on hand for the quarter ending June 30, 2022 was $48.231B, a 21.82% decline year-over-year.

Apple cash on hand for 2021 was $62.639B, a 31.12% decline from 2020.

Apple cash on hand for 2020 was $90.943B, a 9.56% decline from 2019

Apple cash on hand for 2019 was $100.557B, a 51.67% increase from 2018.[1]

[1] https://www.macrotrends.net/stocks/charts/AAPL/apple/cash-on...

Re: The end of Apple’s affair with China

#140

Post by paxys »

gjsman-1000 wrote: post #13

To me, I think that Apple's reliance on China, and Taiwan, was and is an extremely risky and misguided decision. Imagine if Apple had developed a total reliance on chip factories built in, say, Ukraine, back in 2018. That's about where we are now with Taiwan and China, I believe. It's sure been profitable - but at, I would argue, obscene risk. A few years of TSMC being unavailable would have Apple on life support. Ap…

Apple went from the brink of bankruptcy to a $3T market cap, all on the back of Chinese/Taiwanese manufacturing. It's pretty safe to say that the move wasn't "misguided".
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