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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

#31

Post by CharlesW »

s1mon wrote: post #26
mannyv wrote: post #8

"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 cou…

> It's also true that Apple is very well known for very hard negotiation…

No successful company is over-paying suppliers.

Re: iPhone maker Wistron quits, saying Apple didn't let it make a profit

#32

Post by paulryanrogers »

actionfromafar wrote: post #27
karamanolev wrote: post #16

Earlier quoted context omitted.

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 .

There be dragons.

Better a high trust society with some checks and balances than one ruled by "don't write down anything" sociopaths.

Re: iPhone maker Wistron quits, saying Apple didn't let it make a profit

#34

Post by cptskippy »

phone8675309 wrote: post #29
5350-uiop-1130 wrote: post #13

https://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

The book The United States of Wal-Mart by John Dicker laid this all out pretty clearly nearly 20 years ago.

* corrected spelling the author's name.

**https://www.amazon.com/United-States-Wal-Mart-John-Dicker/dp...

Re: iPhone maker Wistron quits, saying Apple didn't let it make a profit

#35

Post by crooked-v »

ly3xqhl8g9 wrote: post #20
5350-uiop-1130 wrote: post #13

https://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…

At least our current surface finishing technology has advanced so we no longer see the kid sized hand prints [1]. "Apple’s cobalt batteries are built on the backs of child labor in mines, causing severe physical harm to children and violating international standards of human rights." [2] Their PR: "Apple will use 100 percent recycled cobalt in batteries by 2025" [3]. [1] Kid sized hand prints on old victorian roof ti…

You seem to be assuming that 3 is a lie, but I'm pretty sure someone would notice if Apple wasn't actually changing the sources of their rare earths.

Re: iPhone maker Wistron quits, saying Apple didn't let it make a profit

#36

Post by A4ET8a8uTh0 »

phone8675309 wrote: post #29
5350-uiop-1130 wrote: post #13

https://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

Some context may be needed. Walmart is known in MBA circles for being one of the first companies to have used detailed data on products to negotiate new terms with suppliers ( usually to suppliers detriment ). Information asymmetry with main goal to increase a chance for an increased leverage is what it is all about.

Re: iPhone maker Wistron quits, saying Apple didn't let it make a profit

#37

Post by Centigonal »

CharlesW wrote: post #31
s1mon wrote: post #26

Earlier quoted context omitted.

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 cou…

> It's also true that Apple is very well known for very hard negotiation… No successful company is over-paying suppliers.

There's a difference between over-paying suppliers and being literally the best in the world at squeezing suppliers, which Apple is IMO.

You can argue (and I will argue) that Apple's skill at squeezing their suppliers while still maintaining reliable supply chains is a huge part of why they're the biggest company in the world (and also why Tim Cook and not Scott Forstall or Jony Ive succeeded Jobs). That squeezing has real human costs, which Apple is insulated from.

They've outsourced the majority of their labor (and related liability) to a global cadre of high-volume, low margin suppliers, while capturing most of the value created by that labor by owning the Apple brand and maintaining tight control of information, resulting in an asymmetric risk/reward profile for Apple inc.

Re: iPhone maker Wistron quits, saying Apple didn't let it make a profit

#38

Post by reaperman »

5350-uiop-1130 wrote: post #13

https://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…

This is the same playbook the auto industry has followed for the past 50 years or so.

Re: iPhone maker Wistron quits, saying Apple didn't let it make a profit

#39

Post by dirtyid »

alephnerd wrote: post #23
dirtyid wrote: post #17

Not 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…

I rememeber in 90s, local mid-level managers who worked for MNC in PRC tend to like their SKR bosses and frequently hated TW bosses simply because cultural overlap allowed them to push harder. With SKR they could at least feign ignorance with language barrier but TBH still got their work done. I can imagine shitshow of having language barrier and still not meeting KPIs because they're not cross culture competent.

Anyway Tata feels like a good fit, always felt like matter of time before audit/tax or political shenanigans drive foreign electronics assemblers out and eventually consolidate under India champions. Still seems a little premature, but I remember numbers last year that 2500/12000 registered forreign companies closed Indian operations since mid 10s, so maybe it's time for India chaebols to take over.

Re: iPhone maker Wistron quits, saying Apple didn't let it make a profit

#40

Post by avmich »

A4ET8a8uTh0 wrote: post #36
phone8675309 wrote: post #29

Earlier quoted context omitted.

They're using the Walmart playbook

Some context may be needed. Walmart is known in MBA circles for being one of the first companies to have used detailed data on products to negotiate new terms with suppliers ( usually to suppliers detriment ). Information asymmetry with main goal to increase a chance for an increased leverage is what it is all about.

I wonder if the supplier can similarly have the detailed data on the customer and how that helps in negotiating both ways.
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