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Might iPhones one day be manufactured in the U.S.? If someone 30 years ago told you Japanese...

Might iPhones one day be manufactured in the U.S.? If someone 30 years ago told you Japanese auto manufacturers would now have such a large production footprint here, would you have believed them? "The U.S. has a long history of demanding that companies build here if they want to sell here," says a former Reagan official who helped start the process of Japan moving to the States. "If Apple or Congress wanted to make the valuable parts of the iPhone in America, it wouldn't be hard."
Comments (23)
  • D_Virginia
    , contributor
    Comments (2280) | Send Message
     
    We DO make the valuable parts of the iPhone here in America: the design.

     

    We need to stop trying to get back to manufacturing. It's low skill, low margin work with high switching costs, and productivity gains will continue to reduce the number of people it employs.

     

    We need to START educating and training our population so that they can take advantage of the millions of jobs out there that companies can't seem to find qualified applicants for.
    5 Aug 2012, 08:54 AM Reply Like
  • emburns
    , contributor
    Comments (218) | Send Message
     
    The only caveat is that not all the workers can be designers, engineers, etc. The idea that everyone in America must be on a college track is the root of what is wrong it's the educational system today.

     

    Apprentice schools should be a viable and respectable choice for students to pursue a career in welding, automotive work, electrical work, etc. The only issue is that society sad brainwashed these kids to equate manual labor with low status. In my father's day, some of the most respected men where those who did an honest day's work at the shipyard.

     

    A shift needs to happen in the education system which allows for those students who would excel in such settings to be allowed pursue such a career, rather than being forced into a higher educational system which it is almost impossible to graduate or even find a job. The opportunity cost of those 4 years could be better spent learning a trade.
    5 Aug 2012, 10:13 AM Reply Like
  • RyanH
    , contributor
    Comments (126) | Send Message
     
    I do not think this could be stated any better. I have been saying this for years, stop forcing a flawed education model on our newest generation. However, my only caveat is that the shift need not be in the educational system so much as a shift in parental views. If people did a rational assessment of their children's' potential and are honest with themselves and their child, they could prevent the continued frothiness in the education market and help guide their children to happier more productive lives.

     

    But how likely is this?
    5 Aug 2012, 11:09 AM Reply Like
  • D_Virginia
    , contributor
    Comments (2280) | Send Message
     
    emburns, I don't disagree at all regarding 'blue collar' work, but I still think manufacturing in particular is a losing investment. The current rapid advancements in 3D printing alone will soon drastically reduce the need for manual manufacturing labor.

     

    But for the record, there is nothing at all wrong with trade schools, nor is there anything wrong with directing the less academically inclined students toward these paths. Add in a little business skill and those kids could end up running their own businesses and making a very nice living, providing real value unlike some industries (*cough* financial services).

     

    We have to realize that not everyone can be Bill Gates, Steve Jobs, or Warren Buffett, nor can everyone trade stocks for a living.

     

    We NEED real businesses that provide real value behind those stocks, or nothing works.

     

    The reality is that some people won't ever make it past construction worker, but those people can still add a lot of value and shouldn't be hung out to dry in downturns.

     

    However, that sounds somewhat like a bad word that has recently been demonized by the rabid right:

     

    "From each according to his ability, to each according to his need"...

     

    So good luck selling that idea after the PACs buy the elections. :)
    5 Aug 2012, 11:55 AM Reply Like
  • emburns
    , contributor
    Comments (218) | Send Message
     
    I couldn't agree more, I would like to add that I didn't mean solely manufacturing jobs. The whole argument could be expanded to tailors, bakers, cobblers, etc.

     

    Perhaps students should be required to leave high school with some discernible skill such as writing code, laying brick, baking cakes, etc. But these options won't be available until a seismic change in our society's perception of "worth."

     

    I do disagree with your last statement - the notion that every member of society should be propped up. Perhaps I lean a little top much towards the Austrian School of thought - but I feel the government should play no part in subsidizing the lifestyles of its constituents in downturns, rich or poor.
    5 Aug 2012, 01:45 PM Reply Like
  • wyostocks
    , contributor
    Comments (7873) | Send Message
     
    d-v
    "but those people can still add a lot of value and shouldn't be hung out to dry in downturns."

     

    And just what exactly do you mean by this statement?
    5 Aug 2012, 04:41 PM Reply Like
  • D_Virginia
    , contributor
    Comments (2280) | Send Message
     
    > the government should play no part in subsidizing the
    > lifestyles of its constituents in downturns, rich or poor.

     

    Perhaps not the (unnecessarily lavish) "lifestyles", but what about the "lives" (i.e., subsistence)?

     

    You heard me: reasonable social safety nets.

     

    I shouldn't be surprised anymore by the degree of cognitive dissonance most of you maintain, but sometimes I still am.

     

    You're basically saying, on the one hand, "We need people who can do Trade X! All you high school kids, go learn how to do Trade X! Forget college, just be an employee in Trade X!"

     

    Then on the other hand, "But if Trade X goes away...too bad, you should have planned for retooling your career that like your Harvard MBA professors told you! What? You didn't get a college degree? Wow, that was stupid of you! Oh well, suckers, you make your own choices!"

     

    Face it: Blue collar workers can't shift gears as easy as white collar workers.

     

    It's easy for most finance people to just jump on other investment vehicles: just stop leeching off of one industry and start leeching off of another. It's easy (or at least, common) for most programmers and engineers to keep up with their ever-changing fields: much of this training is even paid by employers. Etc, etc, etc.

     

    But, to use simplistic metaphor, what does a door man do when the doors start to open themselves? What does someone who makes Widget A do when A isn't needed anymore and Widget B is now all the rage?

     

    What do you do with construction workers when a 3D printer can basically print a house? (http://invent.ge/NVUGKu)

     

    Back in the days before globalization, companies handled this. The contract was often something like, "If you always do a good job, you'll always have a good job" (IBM)...and maybe that's far too utopian these days, but perhaps the new contract is "If you always do a good job, you'll always be able to get a good job" (through frequent retraining and other education).

     

    Not so today. "Sorry fella, we have shareholders to think about! Here's your pink slip!"

     

    Certainly existing safety nets like unemployment are far from optimal as implemented today. For example, people should be required to do something or learn something for those UE paychecks (perhaps with liberal leave policies for actual job hunting activities).

     

    We have to either:
    1) retrain displaced workers to be productive again,
    2) throw them to wolves and accept a growing mass of displaced workers which will one day blow up in our faces, or
    3) recognize the gradual reduction in the need for full employment (discussed fairly clearly here: http://bit.ly/NiLdba).

     

    I'm guessing you two (emburns and my good buddy wyo) favor #2. :)

     

    Everyone is entitled to their opinion, but perhaps we should look at the whole chess board, rather than just our own piece? Food for thought.
    5 Aug 2012, 08:51 PM Reply Like
  • phxcrane
    , contributor
    Comments (416) | Send Message
     
    Well D We don't always agree but your spot on with this comment.
    5 Aug 2012, 10:04 AM Reply Like
  • wyostocks
    , contributor
    Comments (7873) | Send Message
     
    It is a wee bit cheaper to ship IPhones around the world than cars.
    5 Aug 2012, 10:07 AM Reply Like
  • marilyn61
    , contributor
    Comments (173) | Send Message
     
    China has had a lot of practice at manufacturing this sort of thing. Cheap labor makes it hard for other countries to compete and the workforce does seem to be well trained. How can workforces from other countries even begin to think about existing on this level of low wage ?
    5 Aug 2012, 10:18 AM Reply Like
  • moneyTalksBSWalks
    , contributor
    Comments (193) | Send Message
     
    In the long term 2 things will need to happen in parallel maybe with different timelines. Everybody paying more as more things are made here AND a lowering of our standard of living. The gilded age of rising standards of living over several decades since WW2 is long gone now, the path now is either flat or downwards.
    5 Aug 2012, 12:36 PM Reply Like
  • David Urban
    , contributor
    Comments (1036) | Send Message
     
    Low cost of living helps immensely.
    5 Aug 2012, 10:53 AM Reply Like
  • anonymous#12
    , contributor
    Comments (552) | Send Message
     
    Yes, that's what America needs. Low skill manufacturing to pay our workers $1 per hour.
    5 Aug 2012, 12:18 PM Reply Like
  • moneyTalksBSWalks
    , contributor
    Comments (193) | Send Message
     
    Good NYT read but the notion that we can force in large quantity a shift of manufacturing jobs from China to USA is naive at best imo. China is not Japan for one, we have lesser leverage, the Chinese are much more ruthless than the Japanese and oh by the way, they happen to be our largest creditor. As a society I don't think we are really prepared for paying at least 20% more for everything that we buy -- be it electronics or the stuff of everyday living from Walmart. We want everything and want to sacrifice nothing so until a real disaster strikes and forces change, planned change is near impossible in our polarized society.
    5 Aug 2012, 12:32 PM Reply Like
  • Econdoc
    , contributor
    Comments (2944) | Send Message
     
    a really terrible idea

     

    to force companies to manufacture in the US in order to sell in the US

     

    this is a failed idea and leads to lower productivity, lower growth and lower pay - the main proponents are in Argentina and Venezuela

     

    most of the value in an iPhone is generated in the US - in the software, the apps, the design, the retail, the marketing, the glass

     

    the components and the assembly are a small part of the value chain

     

    it is a nonsense to think that forcing these jobs back to the US at $2 per hour is a good thing - only a fool would believe and if you somehow could force them back and force the company to pay $10 to $15 per hour - the outcome would be obvious - say good bye to the high paying jobs that actually are here that relate to this

     

    this is the folly of the anti-outsourcing crowd - companies arrange their supply chains to compete and the result is an efficient growing company with often higher paying and sustainable jobs in the US where the comparative advantage is a higher skilled more productive workforce.

     

    the car industry is a shining example of what happens when productivity and proximity trump labor cost - the jobs come back by themselves without some fool bureaucrat having to intervene. albeit they are non-unionized and generally in right to work states which in and of itself is indicative of the drag that Obama and organized labor create

     

    E is for Economic Efficiency and Productivity - the only thing that underpins long run sustainable growth

     

    E
    5 Aug 2012, 02:02 PM Reply Like
  • davidbdc
    , contributor
    Comments (3154) | Send Message
     
    This is nonsensical. How much does it cost to ship an Iphone? And how much to ship a full sized sedan?

     

    There is your answer. There was no outcry for Japan to build cars here. There was no outcry to make t-shirts here. And there will be no outcry to make Iphones here.

     

    Americans in general are conditioned to use price as a primary driver in their consumer decisions. As long as that is the case we'll keep buying the cheapest stuff and it will be made in the cheapest location. I generally try to buy American - but I think I'm in about the 3% of the population that actually checks to see where something is made. And thats just the way it is.
    5 Aug 2012, 02:06 PM Reply Like
  • Sam Liu
    , contributor
    Comments (3864) | Send Message
     
    Didn't Honda began manufacturing in the USA some 30 years ago?
    5 Aug 2012, 02:12 PM Reply Like
  • Herr Hansa
    , contributor
    Comments (3080) | Send Message
     
    Steve Jobs discussion of "why not?" focused on the engineering skills, light manufacturing of prototypes, and location of specialist component factories in close proximity. There are not U.S. equivalents of factory towns as in China, with many different capabilities and suppliers closely aligned and located.

     

    Labor costs, or even semi-skilled labor are other issues. While Foxconn workers sign a waiver that allows them to work excessive hours under tough conditions, that sort of concession between employers and workers is simply not possible in the U.S. So it's not the labor cost, but the yield potential. It would not be possible to produce as many iPhones a day in the U.S. as in China. Those long lines of people waiting to work at Foxconn is something that will not be duplicated in the U.S.
    5 Aug 2012, 02:21 PM Reply Like
  • Sam Liu
    , contributor
    Comments (3864) | Send Message
     
    "Those long lines of people waiting to work at Foxconn is something that will not be duplicated in the U.S."

     

    THINK it can be duplicated, but tomorrow, there would be numerous investigations and law suits against it.

     

    WHY put up with that hassle?
    5 Aug 2012, 02:30 PM Reply Like
  • Herr Hansa
    , contributor
    Comments (3080) | Send Message
     
    Exactly. The U.S. has more worker protections in place than China. The system of workers and employers is different in China than in the U.S.

     

    This reminds me about a few articles on the Financial Times discussing competitiveness. While the focus was on Europe, especially Greece, the idea put forward by politicians was reducing labor costs to increase competitiveness. What that fails to consider is that workers spend money in all economies. If labor cost went to zero, an economy will not improve. So low cost labor is not the answer to competitiveness, despite what some politicians might suggest.
    5 Aug 2012, 02:37 PM Reply Like
  • SanDiegoNonSurfer
    , contributor
    Comments (2682) | Send Message
     
    The U.S. doesn't need to manufacture iPhones. There are plenty of other -- and more innovative -- things we can be doing. And that includes blue-collar opportunities. I'd rather our gifted tinkers produced a robotics product in a garage in their spare time than be turned into suicidal drones working 56-hour shifts at a U.S. version of Foxconn.
    5 Aug 2012, 02:56 PM Reply Like
  • taxed2much
    , contributor
    Comments (161) | Send Message
     
    Actually the majority of Japanese vehicles sold here are manufactured on the American continent. Like all cars built today they have numerous parts supplied from all over the world shipped to assy plants.
    As for money-X commenting on corporate taxes, there are some things you are missing alright. The fact is that not one single business will ever pay a single dime in taxes, ever. Corporations do not pay tax, nor do they earn income. People make money and people pay taxes. So when you have an overreaching gov't taxing any corporation you end up causing three basic results. 1). Employees of the company see lower salaries, less benefits, less paid time off like vacations or medical, and less profit sharing or bonuses. 2) Shareholders see decreased dividends and less stock splits or less share value increases or more likely a decrease. 3) The customers pay more for the product, with Google that would translate to either less new software available for free and/or more ads per page or even a hidden cost service providers would pass onto customers if Google ended up having to sign deals with them to access their servers. Highly unlikely but a business is in business to make money, not pay it to scumbags in Congress who will not spend it wisely, will spend it on things we disagree on, and will skim a hefty portion off the top for themselves doing nothing but arm twisting. This gov't does not need more in tax revenue, they need to quit spending on things that should not be spent on. So much corruption in all sectors is because of the legislation and it all starts in DC.But back to taxes on corporations. So hopefully now you understand that a tax laid upon business is really a tax on the people, either in the company or out of it or both. These taxes are also known as hidden taxes. We don't get charged directly for them but we pay them all the same. So now do you think taxing businesses is good for the country(Congress) and the people? Or maybe just good for Congress?
    Some have commented on manufacturing the iPhone here and I think that would be great but we also would have to be willing to pay double or triple what they cost now. Until we get free trade agreements that equate to the US not being bitch slapped by the Congress for the Chinese to send their products here for less than we can send ours to them, manufacturing will not come back here for small durable goods or non durables for sure. It costs about ten cents a baseball hat to be made there and about three bucks here, both the same quality. Who do you think the purchaser will buy from? Where the profit margin is higher.
    5 Aug 2012, 07:18 PM Reply Like
  • taxed2much
    , contributor
    Comments (161) | Send Message
     
    Hey I'd like to know how this venture turns out for you. I am always interested in learning how to avoid the IRS. Currently though if you really want some good info you can trust as true and works I highly recommend the book by Pete Hendrickson called "Cracking The Code--The fascinating truth about taxation in America". I bought this book a few years ago and now he gives the ebook away for free. You can also order a hard copy of it as well as some others he has written. This book though, CtC for short, is a total in depth guide to understanding the code, how it is written and why it is written the way it is, and shows that the income tax laws are Constitutional but that they apply to a very limited group of people known as taxpayers who earn income and are employees. Those words all have specific defined meanings within the code and those meanings limit the application of the law to those select few who fall within the definitions of those and many more words they use to trick us into thinking everyone is liable for the income tax. A designation you should not want at all. Because in the end, who do you think knows how to spend what you labor for? You or the gov't? Who will spend on things you agree with and won't on things you disagree with? You will. If you think the possibility that there will be no SS or medicaid medicare programs by the time we retire, then you should learn how to have all the money they steal from your paycheck returned to you every year so you can then utilize that huge amount of money for your benefit and not for the benefit of this bloated uncaring gov't the so called servants of the public rule over us with. It might be a little easier to do than what your thinking of doing with out of country entities you really have no control over once they have your money. China is a long way to go to try and get back what you deposit if something goes wrong, plus if you don't know the language you got double trouble. And triple trouble since the orientals are very race biased toward their own. And when challenged they will always stand against another in order to "save face". So buyer beware.
    6 Aug 2012, 02:31 PM Reply Like
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