Possibly, most people are aware of the fact that Apple manufactures its infamous iPhone in China to keep procurement and manufacturing costs minimal. But, a report from Nikkei Asian Review now suggests that the Cupertino giant’s primary manufacturing partner, Foxconn and other manufacturers are exploring possibilities to relocate their iPhone manufacturing facilities from Asia to the U.S.
This (yet-to-be-confirmed) move from Apple comes on the heels of the election outcome landing in favor of Donald Trump. It also falls in line with the President-elect’s vision of pushing home-brewed tech behemoths to manufacture their products in the States. During his election campaigns, he even took exclusive jabs at Apple, calling them out for cutting industrial jobs in the country. To further his point, Trump had pedged to slap a hefty 45 percent tariff on goods made in China.
We’re going to get Apple to build their damn computers and things in this country instead of in other countries,
said the President.
While Trump is yet to take his rightful position at the office, Apple has already instructed its partner manufacturers to analyse if they can move iPhone production plants to the United States. With intel gathered from sources privy to the matter, Nikkei mentions that Foxconn Technology Group “has been studying the possibility of moving iPhone production to the U.S.” It also mentions that Apple CEO Tim Cook made the said request to its supply partners as early as June.
Apple asked both Foxconn and Pegatron, the two iPhone assemblers, in June to look into making iPhones in the U.S. Foxconn complied, while Pegatron declined to formulate such a plan due to cost concerns,
claims one of the sources.
Though, Foxconn, the iPhone manufacturer responsible for over 50 percent sales, is unhappy with this request from the Cupertino giant but it is willing to explore opportunities to prepare themselves for the inevitable. The concerns over increase in manufacturing cost is one of the primary reasons behind Chairman Terry Gou lack of enthusiasm for this deal. The cost of manufacturing will end up doubling, if the company choses to manufacture the same in U.S, believes one of the sources.
But, as Apple-focused publication MacRumors rightly points out, Cook had previously mentioned that the company prefers to manufacture their products in China becuase of adbundant availability of ‘skilled’ labor. Due to their vocational kind of skills, he added that the company requires a smaller number of individuals to manufacture its products. Back then, Cook added,
China put an enormous focus on manufacturing. In what we would call, you and I would call vocational kind of skills. The U.S., over time, began to stop having as many vocational kind of skills. I mean, you can take every tool and die maker in the United States and probably put them in a room that we’re currently sitting in. In China, you would have to have multiple football fields.
While the decision to relocate iPhone still isn’t finalised but the President-elect will most likely attempt to force the tech behemoths to start manufacturing their devices in the country. To meet the ever-increasing hunger for Apple products, the two manufacturers – Foxconn and Pegatron – together manufacture over 200 million iPhone annually.
