How the US lost out on iPhone work
This incredible investigative report by the New York Times takes a look behind the scenes on why Apple outsources its manufacturing work to Chinese companies and workers.
The company held out for as long as it could to maintain manufacturing within US borders but eventually caved in and in 2004 shut down its last US plant in Elk Grove, California, which was making Macs. The former plant now serves as a call center for Apple.
As to whether the US can reclaim manufacturing jobs from China, this part is damning:
Another critical advantage for Apple was that China provided engineers at a scale the United States could not match. Apple’s executives had estimated that about 8,700 industrial engineers were needed to oversee and guide the 200,000 assembly-line workers eventually involved in manufacturing iPhones. The company’s analysts had forecast it would take as long as nine months to find that many qualified engineers in the United States.
In China, it took 15 days.
The Atlantic last year calculated how much an iPad would cost if it was manufactured in the US, it was $1,140. That point was rebutted but then the rebuttal itself was claimed to have been taken through a misunderstanding. If this is all too confusing to follow, let’s take this discussion back to the point in the NY Times article.
“What U.S. plant can find 3,000 people overnight and convince them to live in dorms?”
China’s Foxconn can and has done this.
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