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The Beer Game -or- Why Apple Can’t Build iPads in the US

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Re: The Beer Game -or- Why Apple Can’t Build iPads in the US

#51

Post by rbarooah »

simonh wrote: post #42
diogenescynic wrote: post #4

Apple could afford to reopen the plants they had in Fremont, they just might not be able to produce 100% of their products there . From the NY Times article he refers to: paying American wages would add up to $65 to each iPhone’s expense. Fender does this--they offer you the choice of a Chinese, Mexican, Japanese, or American made guitar and just price accordingly. I would pay more for an iPhone that I knew was made…

Disclosure: I'm a Brit, and my wife is Chinese. Frankly I have no time for flag-waving 'Buy American' and for that matter 'Buy British' favouritism. I've seen the poverty in rural China first hand, industrialisation over there has it's rough edges that need to be addressed, but if we care about world poverty then that means cutting all the jingoistic claptrap and 'allowing' them to earn a better living. There are leg…

Don't you think that decades of isolationist Maoism had more influence on the rural poverty in China than US and British protectionism?

Re: The Beer Game -or- Why Apple Can’t Build iPads in the US

#52

Post by tosseraccount »

yummyfajitas wrote: post #16
diogenescynic wrote: post #4

Apple could afford to reopen the plants they had in Fremont, they just might not be able to produce 100% of their products there . From the NY Times article he refers to: paying American wages would add up to $65 to each iPhone’s expense. Fender does this--they offer you the choice of a Chinese, Mexican, Japanese, or American made guitar and just price accordingly. I would pay more for an iPhone that I knew was made…

...paying American wages would add up to $65 to each iPhone’s expense. The point of the article is to illustrate that wages are not the only problem. Chaotic effects in multi-tier supply chains are also a real problem. I would pay more for an iPhone that I knew was made in America. I'm sure I'm not the only one. You are certainly a minority. I don't think most people value nationalism at $65. Personally, I'd rather h…

Therefore ... you'd happily give up your job to someone who needed more? Just to prove a point.

Re: The Beer Game -or- Why Apple Can’t Build iPads in the US

#53

Post by bdunbar »

e40 wrote: post #48
tlb wrote: post #17

Having gone through the painful exercise of building robots in the US, I appreciate the problem. Our end-end supply chain latency was 16 weeks, far too long to scale effectively to match demand. Many component changes we wanted to make would have created a 6-week delay, so we had to compromise. A place with a factory across the street that could make screws in 3 hours sounds like heaven.

But what is the cause and what is the effect? The supply chain latency in the US is so high because over the last 3-4 decades we've moved from a producer to a consumer. It's because we don't manufacture stuff anymore that this latency is an issue.

It's because we don't manufacture stuff anymore that this latency is an issue.

I love it when people say that. I love it because I work for a company that very much does still make stuff in the US.

We just make more stuff, with fewer people.

We also make stuff in Asia, EU, Mexico. It's hard to stereotype who makes what - but generally sites in NA make the complicated, expensive widgets, Asia make the high volume not-so complicated gear, EU is a mix.

Re: The Beer Game -or- Why Apple Can’t Build iPads in the US

#54

Post by acslater00 »

e40 wrote: post #48
tlb wrote: post #17

Having gone through the painful exercise of building robots in the US, I appreciate the problem. Our end-end supply chain latency was 16 weeks, far too long to scale effectively to match demand. Many component changes we wanted to make would have created a 6-week delay, so we had to compromise. A place with a factory across the street that could make screws in 3 hours sounds like heaven.

But what is the cause and what is the effect? The supply chain latency in the US is so high because over the last 3-4 decades we've moved from a producer to a consumer. It's because we don't manufacture stuff anymore that this latency is an issue.

That's a myth. The US has a huge and growing manufacturing base. We make airplane engines, medical devices, computer chips; all kinds of complex, high-tech manufacturing. We have the highest manufacturing productivity per worker in the world. What we don't make anymore are the kinds of products that require rote assembly tasks, like shoes and clothes and iPads. The upshot is that we have decreasing manufacturing employment even as the manufacturing sector grows rapidly.

Would it surprise you to learn that US manufacturing output looks like this?

http://research.stlouisfed.org/fred2/series/OUTMS

Re: The Beer Game -or- Why Apple Can’t Build iPads in the US

#55

Post by mhurron »

roc wrote: post #6

See also: https://en.wikipedia.org/wiki/Business_cluster It's worth noting that one needn't offset all the advantages of a cluster for production outside of it to make sense: There is no shortage of US auto manufacturing plants that are not in Detroit nor in places with anything remotely like its cluster advantage. But for rapidly-changing products, the advantages of a cluster are compounded. If you're not changing s…

What do you think is going to provide more short term profit, move manufacturing back the the US and build X with US workers, or move manufacturing out of China to another cheap country when Chinese labor gets too expensive?

What's gone isn't coming back until it's cheaper to build it in the US. That's what moved it to China in the first place, and that's what will move it from China.

Re: The Beer Game -or- Why Apple Can’t Build iPads in the US

#56

Post by tlb »

e40 wrote: post #48
tlb wrote: post #17

Having gone through the painful exercise of building robots in the US, I appreciate the problem. Our end-end supply chain latency was 16 weeks, far too long to scale effectively to match demand. Many component changes we wanted to make would have created a 6-week delay, so we had to compromise. A place with a factory across the street that could make screws in 3 hours sounds like heaven.

But what is the cause and what is the effect? The supply chain latency in the US is so high because over the last 3-4 decades we've moved from a producer to a consumer. It's because we don't manufacture stuff anymore that this latency is an issue.

Both: it's a self-reinforcing downward spiral.

Re: The Beer Game -or- Why Apple Can’t Build iPads in the US

#57

Post by yummyfajitas »

tosseraccount wrote: post #52
yummyfajitas wrote: post #16

Earlier quoted context omitted.

...paying American wages would add up to $65 to each iPhone’s expense. The point of the article is to illustrate that wages are not the only problem. Chaotic effects in multi-tier supply chains are also a real problem. I would pay more for an iPhone that I knew was made in America. I'm sure I'm not the only one. You are certainly a minority. I don't think most people value nationalism at $65. Personally, I'd rather h…

Therefore ... you'd happily give up your job to someone who needed more? Just to prove a point.

I probably wouldn't be happy about it, but yes - if someone can do my job cheaper or better then I should be replaced.

Re: The Beer Game -or- Why Apple Can’t Build iPads in the US

#58

Post by gnaffle »

If they can build iPhones in Brazil, why can't they build iPads in the US?

That it's not cost effective to do so now doesn't mean that this will always be the case. The US has high import taxes on lots of stuff, if they raised them on electronics we would have US made iPads in a flash (not that I'm saying this is the right approach).

I think Apple's "tell us all the details about your cost structure and we'll talk business" approach to their suppliers combined with their enormous cash reserve and history of pre-paying for parts (and even factories) should enable them to make their devices pretty much anywhere.

Re: The Beer Game -or- Why Apple Can’t Build iPads in the US

#60

Post by clarkmoody »

I love the article up until the lame political statement at the end.

GM / Chrysler bankruptcy != Business disappears and all suppliers go bankrupt. This is the straw-man argument of the left.

The American auto bailout was a purely political play to save the unions who supported the Democrats. With billions in hard assets and a huge intellectual property base, the auto companies would have made great investments to potential buyers. Does anyone actually believe that no one would even attempt to pick up the pieces of the auto industry, sans-unions, and try to come out ahead?

If you agree with the media/government spin, then you believe that the auto companies would have fired all employees, sold all of the manufacturing equipment and plants, and closed shop forever.

The reality is that the company could have used existing bankruptcy law to get rid of some of the union/pension overhead and return to profitability. This is exactly what American Airlines is doing right now. Only in the extreme case would they even need to sell the company.

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