Apple will never make the iPhone in the United States, here is why

Apple will never make the iPhone in the United States, here is why
The main issue that prevents Apple from manufacturing the iPhone in the United States may go totally unnoticed in the grand scheme of things – a simple screw. Obviously, it's not just the screws that make assembling and manufacturing iPhones in the U.S. close to impossible, but that's one of the main problems that Apple, and other smartphone companies, confronted with when trying to move phone manufacturing outside of China.

A comprehensive The New York Times article highlights some of the problems that Apple would have to face if it decides to move manufacturing operations from China to the United States. The trade war between the two countries is heating up after the United States recently announced that it files charges against China's Huawei CFO for stealing trade secrets.

But even before tension between the two countries escalated to this point, President Donald Trump demanded that Apple should begin manufacturing the iPhone in the United States:

Alas, building one or more manufacturing plants in the U.S. would not solve the issues Apple will face after moving its business operations from China. First off, Apple completely relies on China's ability to adapt to any manufacturing requirement from changing the number of screws or mainboards to be made, to the size of the smartphone components.

The screw screwed up Apple

There's a suggestive example in The New York Time's piece, which offers a devastating image on Apple's inability to make its own products in the U.S. rather than outsourcing them to Chinese companies.

Back in 2012, Tim Cook announced that Apple will start making a Mac computer in the U.S., the first Apple product to be fully manufactured by American workers – the Mac Pro. Unfortunately, Apple's plant in Austin, Texas, struggled to find enough screws needed for the Mac Pro, as Apple was relying on a manufacturing contractor in the U.S. which could only produce 1,000 screws per day.

But the screw shortage was only one of the main issues that prevented Apple from keeping its promise and make the Mac Pro in the U.S. These problems led to months of delay and ultimately forced Apple to order screws from China to be able to finally launch the Mac Pro on the market.

That was the turnaround moment that convinced Apple that manufacturing the iPhone or any other of its products in the U.S. would be impossible. No other country was able to match China's level of skills, infrastructure, volume, and cost at that time, and things haven't changed to this day.

Another problem Apple faces if it were to manufacture the iPhone in the U.S. is the cost. According to the Cupertino-based company, starting pay for workers assembling its products in China was $3.15 per hour, but a similar job in the U.S. would be paid much better. Normally, that would lead to lower profits for Apple, but much of the assembly costs would be reflected in the product's price, which would increase exponentially.

Not to mention that workers in China work in shifts at all hours and, sometimes, they're bothered from their sleep to meet production goals, something that it's simply not possible in the U.S. The only solution to this problem would be for Apple to heavily invest in robotics and specialized engineers rather than hiring a huge amount workers paid with minimum wages.

So, it's not that work in China is much cheaper, but also the fact that you can order hundreds of thousands of workers to work all night to meet production goals has become an essential part of the manufacturing business.

Apple looking for new ways to diversify supply chain

Although Apple's business is strongly tied with China, the company was forced to find alternatives after the Trump administration threatened to place tariffs on phones produced in China. Two countries have already met Apple's requirements and have become important players in its supply chain: India and Vietnam.

As the political tension between China and the United States continues to rise, Apple is expected to find new partners outside China that would be able to provide it with the same combination of skill, volume, and low costs, even if that means investing in new plants that would start production in 1-2 years from now.

Although Apple continues to hire workers in the United States, none of the jobs are expected to be in manufacturing, which clearly suggests that company has no plans to start making the iPhone in the U.S., at least not for the foreseeable future.

Can I buy a smartphone that it's not made in China?

It's true that most of the smartphone production has moved to China, as all major players in the industry manufacture their products in the People's Republic of China. However, there are some notable exceptions, although too few to mean something in the grand scheme of things.

The most important are Samsung's flagships, the Galaxy S8/S8+, S9/S9+, Note 8 and Note 9, which are made in South Korea, Vietnam, and China. Then, there's the Google Pixel 2 and Pixel 2 XL, which are manufactured in South Korea in partnership with LG.

Some of HTC's smartphones like the U11 and U11 Life are made in Taiwan, just like the Asus ZenFone 4 Pro. Even Sony is making one of its smartphones, the mid-tier Xperia XA2 Ultra in Japan, while LG V30 wears the “Made in South Korea” tag.

Some of these smartphones aren't manufactured in China because not even this country's amazing infrastructure can meet the high-volume that Samsung or other companies need in a very short time. However, those of you looking to buy a phone that's not made in China, know that you'll severely limit your options. Also, all devices that are assembled in South Korea, Taiwan, Vietnam or other countries, pack inside components that are made in China.



1. antroid

Posts: 396; Member since: Jan 24, 2018

I'm not sure Trump will agree with this article...

12. TheOracle1

Posts: 2340; Member since: May 04, 2015

There are some valid points in this article but it's oversimplified to the point of ignorance. Here's the real reason straight from Tim Cook: "The products we do require really advanced tooling, and the precision that you have to have, the tooling and working with the materials that we do are state of the art. And the tooling skill is very deep here. In the US you could have a meeting of tooling engineers and I'm not sure we could fill the room. In China you could fill multiple football fields." There's also a YouTube documentary about why every major player has a presence in Shenzen. It basically shows how the Chinese are 12-18 months ahead of everyone in terms of technology. The IP argument is insignificant.

2. 14545

Posts: 1835; Member since: Nov 22, 2011

Such an oversimplification and misunderstanding of production constraints. It *could* be made in the US, at a cost. The problem. Is noone wants to pay those costs. The screw problem should have been recognized in the design and procurement phase. The company they were buying from could have told them their throughput both anticipated and historically and they could have seen tbhg bottleneck from the onset. That being said, to maintain their margins, which they love more than life itself, it wood require charging 1500 or more for the phone. Then you enter the death spiral becuase demand plummets which begets layoffs, which begets further demand decreases. Anyway, this article is written by someone who clearly doesn't understand supply chain, logistics, or engineering.

7. Finalflash

Posts: 4063; Member since: Jul 23, 2013

They were well aware of the screw issue, to say they weren't is just naive. They did that on purpose so they can pass the blame. Not only did they promise to make Apple's most insignificant product in terms of volume in the states, but they then didn't line up their suppliers properly...for screws. Now they can say "we tried".

3. almostdone

Posts: 450; Member since: Sep 25, 2012

Apple moving to Vietnam or India is not going to work out too well. Trump will simply slap tariffs wherever Apple go except in the U.S. What will perhaps make it worse they will spend billions on these new plants and then boom their lovely customers will pay the extra premium it cost Apple to get it setup and then wasted.

4. cmdacos

Posts: 4392; Member since: Nov 01, 2016

Because Americans wont work for pennies like the current workforce manufacturing smartphones.

5. D34ever

Posts: 248; Member since: Jul 14, 2018

Stating the obvious.

6. tacarat

Posts: 854; Member since: Apr 22, 2013

Motorola made the original Moto-X in the US. Maybe they didn't promote that aspect enough, but the "Patriots" didn't buy enough to make it worth continuing making it here.

17. lJesseCusterl

Posts: 96; Member since: Apr 27, 2015

Motorola has been a market non-factor since the RAZR finally lost popularity. They've been 3-5% of the smartphone market since then.

20. tacarat

Posts: 854; Member since: Apr 22, 2013

I wouldn't disagree with that, but the point is that "Buy American" only applies if it's something people want. Folks won't necessarily change their purchases just because of where it's manufactured, no matter what they say.

8. osterrich21

Posts: 190; Member since: Apr 14, 2017

Why Samsung, which is Korean, makes its products in the US and Apple can not?

9. koioz

Posts: 188; Member since: Nov 29, 2018

Because samsung is not greedy af. They can pay american workers while apple just want a profit profit profit.

11. kiko007

Posts: 7525; Member since: Feb 17, 2016

What product does Samsung make here?

13. DnB925Art

Posts: 1168; Member since: May 23, 2013

To name a couple: Nand flash wafers in Texas and a new appliance plant in North Carolina.

15. mootu

Posts: 1541; Member since: Mar 16, 2017

Nand flash is a mainly automated process requiring only a small workforce. Appliances, it works out cheaper to build them in the areas where they are to be sold. Shipping appliances is very expensive, especially to the US. Phones are not expensive to ship around the world, the estimates are that 44,000 fit in a shipping container.

10. JRPG_Guy

Posts: 152; Member since: Jan 13, 2019

One less reason to buy

14. Kibzara

Posts: 125; Member since: Feb 24, 2016

Lol, the level of greed and ignorance in their statement is too goddamn high! Do they really think all people are dumb and blind?! They can sell these bs stories to users like whatev and such...

16. Valdomero

Posts: 707; Member since: Nov 13, 2012

Too long just to say the manufacturing cost of salaries will be too damn high if they settle in the US to make those phones. Everybody knows the chinese work for pennies worth of job hours and get close to non benefit from human-rights. Imagine an iPhone being made in the US, the cheapest might start at $1800, no joke.

18. lJesseCusterl

Posts: 96; Member since: Apr 27, 2015

Because American workers would probably be a little weirded out that they work in a building equipped with anti-suicide nets.

19. drazwy

Posts: 367; Member since: Jan 15, 2014

Slave labor. There, shortened your article.

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