If Wistron was having quality problems, as has been rumored about iPhone production in India [1], this could have been the sort of deal where both sides lost.
[1] https://www.theapplepost.com/2023/02/26/apple-disappointed-w...
iPhone maker Wistron quits, saying Apple didn't let it make a profit
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Re: iPhone maker Wistron quits, saying Apple didn't let it make a profit
#22"We didn't understand our costs, so we underbid and now are blaming Apple." - Wistron
Or perhaps even more damning (as the article also mentions):
"We expected to get away with paying our workers lower than the legal minimum"
Re: iPhone maker Wistron quits, saying Apple didn't let it make a profit
#23Not just Apple manufacturing, seems like they're divesting from India in general after 10 years, also killing their plans to make laptops and EV components. My understanding is they were barely making money throughout their time in India. Wonder if Tata takeover of iphone assembly going to do better? Kind of expected outcome for TWnese companies known to treat their labourers like shit and India gov unable to manage…
Winstron's divestment to Tata was honestly a good move.
A big reason Foxconn, Winstron, and other Taiwanese/Malaysian/Singaporean assemblers were able to succeed in Mainland China was due to cultural competency within the existing Chinese diaspora (eg. knowing how to communicate to who, how to manage workers, etc).
Foxconn, Winstron, and co would just straight up have Taiwanese/Malaysian/Singaporean/Thai Chinese move to Mainland China (in reality mostly Guangdong, Fujian, and Zhejiang due to cultural and familial connections plus the easy commute from Hong Kong or Shanghai) to help manage operations.
Taiwanese companies don't have that kind of advantage within South Asia. At that point, it makes sense just to work directly with Indian conglomerates like Tata, who already have in house domain experience manufacturing everything due to India's Chaebol-esque corporate culture, or Japanese+Korean companies that are open to training from scratch.
I've seen first hand how South Korean and Japanese companies managed their assembly plants in my dad's village in India (they manfuacture the electronics and computers for Wind Turbines) and it was a night and day difference to a similar attempted Taiwanese operation there.
The difference was SK+JP companies would actually try to hire management locally, and if there wasn't anyone qualified, then invest in actually training from scratch, or alternatively, make a partnership with an existing company in India to help manage the local operation.
Meanwhile, the attempted Taiwanese operation underbid severely, saw significant timeline overruns, tried to manage everything in-house, and the project was eventually scrapped and given to a private sector South Korean-Indian consortium. There was also a bit of corruption/malfeasance with the Taiwanese operation which pissed people off in the district.
All this happened in the 2009-2012 timeframe
Re: iPhone maker Wistron quits, saying Apple didn't let it make a profit
#24Apple is so huge that they treat their manufacturers like a freelance design contracts... "We'll let you build our devices. We can't pay you, but think how amazing it will look to have Apple in your portfolio!"
Re: iPhone maker Wistron quits, saying Apple didn't let it make a profit
#25If Wistron was having quality problems, as has been rumored about iPhone production in India [1], this could have been the sort of deal where both sides lost. [1] https://www.theapplepost.com/2023/02/26/apple-disappointed-w...
what portion of apple assembly for things like macbook/watch/iphone aren't 100% done by machine, and if they aren't 100% done by machine (which they aren't), it sounds extremely not easy to do by hand (especially at scale, for "low wages")
what parts can't they automate?
Re: iPhone maker Wistron quits, saying Apple didn't let it make a profit
#26"We didn't understand our costs, so we underbid and now are blaming Apple." - Wistron
Yes, that's certainly a valid reaction, and is likely partially true. It's also true that Apple is very well known for very hard negotiation and squeezing their suppliers until there's only a few percent margin. You'd have to be insanely good at controlling all of your costs to make money all the time under that constraint. If yields change or component/material prices fluctuate the wrong way any predicted profit could disappear.
Apple also pays suppliers on net 90. With inflation the way it's been, any miscalculation there will sink things. Not all suppliers know how to be banks too. Considering how much cash Apple has, this is really reprehensible.
As a supplier to Apple, the gross numbers are so seductive since they are larger than just about anything else, but the net numbers are orders of magnitude less.
Re: iPhone maker Wistron quits, saying Apple didn't let it make a profit
#27Earlier quoted context omitted.
Pretty sure Apple is partly guilty as well. I really doubt they didn’t know exactly how Wistron was bidding so low.
They might have suspected, but I doubt they formally knew. I would guess it was a type of "don't tell me, I don't want to know, plausible deniability and all".
Only suckers formally know anything.
Re: iPhone maker Wistron quits, saying Apple didn't let it make a profit
#28Re: iPhone maker Wistron quits, saying Apple didn't let it make a profit
#29https://nypost.com/2020/12/15/riots-at-apple-plant-in-india-... this is what apple does. they use their clout, then they turn their back and play ignorant whilst placing unrealistic demands on the subcontractors who then place those demand on the labour. from: https://www.macrumors.com/2023/02/14/only-half-of-indian-iph... > "Apple engineers told that Chinese iPhone suppliers and government officials have a "whatever…
They're using the Walmart playbook
Re: iPhone maker Wistron quits, saying Apple didn't let it make a profit
#30Didn't they also have some issues with payments and working conditions for their factory employees?
Correct. Story seems to be, Wistron was screwing over employees to save costs, and used those low-costs to secure a deal with Apple. Then they got caught by the government, and now have to play by the rules. Because of this, they asked Apple for more money, and Apple said no. So now the deal is done. The deal really shouldn’t have happened in the first place, had Wistron played fair from day one.
This sounds like a case of Apple not doing due diligence on their subcontractors.