Trump thinks we can make iPhones in the US just like China. Yeah, right President Trump's trade war with China kicked into gear this week. The upshot is Americans face having to pay more for products and components sourced from the Middle Kingdom, as the eye-watering import tariffs on the gear are set to be passed onto them. Never fear if you're in need of a new iThing, however, as the White House …
"You mean he has finally learnt how the little horsey moves?"
Although he has had no previous experience, he declares he is the bestest horsiest horse rider ever & proves it by skillfully mounting the horse and appears to be in complete command of the situation as the horse gallops along at a steady pace, Melania admiringly watching her husband.
After a short time Donald becomes a little casual and he begins to lose his grip in the saddle, he panics and grabs the horse round the neck shouting for it to stop. Melania starts to scream and shout for someone to help her husband as Donald has by this time slipped completely out of the saddle and is only saved from hitting the ground by the fact that he still has a grip on the horse's neck.
Donald decides that his best chance is to leap away from the horse, but his foot has become entangled in one of the stirrups. As the horse gallops along Donald's head is banging on the ground and he is slipping into unconsciousness. Melania is now frantic and screams and screams for help!!
Hearing her screams, the secret service guard comes out of the store and unplugs the horse.
TLDR: Donald works out how to put a coin in the slot!
I'd say the second was more likely, but I'd echo the "please don't" comment above. It won't end well.
When it was added, it might have seemed like a clever addition (especially in the light of the Revolutionary War) but it is already true that a violdnt revolution can overthrow a tyrant and already true that people will find the weapons they if they need them. It didn't have to be cast in quasi-legal form.
Compared to other countries (that don't have a similar right) the US appears to be no more resistant to bad government and significantly less resistant to violent crime.
As much as I would love to believe the orange man or the people behind him are thick as bricks I think it's quite clear they aren't.
There are two sperate useful outcomes from this little tariff war.
1. Stocks go down, stocks go up. If you know when this will happen then you can make a lot of money. I doubt any billionaires have not gained from this.
2. I tell you you're getting 30% tariffs so you and your supplier work out an agreement to split it in half and cover the costs. 15% each. Tariff goes down to 10%. If you know you can buy something 15% cheaper you ain't going back to the previous price. Obviously this doesn't apply to everything but I think there will be quite a few suppliers who may get caught out with this. On the other side it would be foolish for consumers to expect prices to ever go back to pre-tariff prices.
As for China I don't think it's wise to go poking them with a stick. I don't think it's wise to go poking any countries with sticks and it's especially not wise to poke them all at the same time. The probability for unintended consequences from all this for America is near 100% and it's not going to end well at all. The American deficit is 35.6 trillion and it's projected to rise nearly 2 trillion this year so doing nothing is not an option anymore. The logical and wise option would be to ask what China has done to get into the position it's in and copy that but that would require massive investment in education and training but you can't do that because an educated population won't vote for you.
"I tell you you're getting 30% tariffs so you and your supplier work out an agreement to split it in half and cover the costs. 15% each."
Who's "you"? The tariff gets paid at customs and passed on to the customer. There needs to be a substantially higher mark-up than 30% for the trade to be worthwhile otherwise.
Either the US customer gets nothing or they pay a 30% tax to the USG which is indistinguishable to them as 30% inflation.
Trump. That's why the US can't have nice things.
I think the argument will be that I buy your goods and now have to pay 30% extra for them. I can't cover those costs or pass them on to the customer. Not always the case of course.
The consumer will be hit with 30% on the final price not just the cost of the goods being imported. The joys of capitalism and Trump.
>The consumer will be hit with 30% on the final price not just the cost of the goods being imported.
That's just ridiculous. With all these price rises going around and inflation heating up you would be crazy not to also add a little something extra. 'take it to margin' as they say
We've been poking China with a stick for the best part of a decade or more. They are getting fed up with this so they've systematically reduced their exposure to the US market to at bit under 15% of the total, a point where exports to the US could collapse completely and it would be painful but not fatal. So the only way we're going to get this to work is by dragging our 'allies' with us to get a big enough quorum. This, as the EU has learned through (not) trading with Russia, is a fairly good way to self-immolate.
China's got two advantages over us at the moment. One is that they make just about everything that the world needs, anything from pots and pans to spacecraft. The other is that they're not carrying a pile of sovereign debt. They also have a huge internal market -- there are four or five times as many Chinese as Americans and unlike us lot, 70% of which are now feeling very nervous about their household economy (not to mention household debt), their population can afford to buy the stuff they sell.
Any attempt to address the trade imbalance or US debit or any other of the numerous things we really should be paying attention to will require some internal rebalancing to encourage long tern investment, not this dumb scattergun approach. The initial 'amateurnite' tariffs from a few days ago got 'suspended' not because Trump's winning some deal or another but rather due to his phone ringing off the hook with calls from some Very Important (and Rich) People. (One expression that I heard to describe the situation is that "Trump got off the reservation" -- he's apparently allowed to play President, even trample ordinary people's rights, but he has to leave The Money alone.)(Or Else.)
Anyone who has ever been involved in a factory move even in the same country knows you lose hard won expertise and knowledge in so doing. I would imagine offshoring those jobs (from the perspective of the current staff) would be even more unpalatable, so the owners will lose quality and volume of production for sometime.
Well, Musk might now about manufacturing (and I doubt that) but sure as hell doesn't know to keep his mouth shut. His mouth alone cost Tesla a shitload of money in the last 3 or so months and made Tesla indesirable excatly to the main part of the demographic that was buying EVs.
Realistically I supposed they could always just import a kit of parts (all manufactured in the Far East) then just glue and screw them together,
This achieves nothing but a small number of not very skilled jobs, You simply cannot uplift manufacturing on this scale and move it to another country.
It still does not get away from the much deeper situation that whatever the US (or anyone else) thinks, stuff will have to be imported.
Quite. iPhone screws are apparently a little special fastener with a custom head, made only in (wait for it...) China.
Whether a different tiny fastener could be used, who knows. Perhaps. But fair odds those potential substitutes are also made in China.
Say instead some US business types decide to set up Tiny Custom Fasteners, Inc. on shore, sounds encouraging, eh? After all, that's what the current regime has been promising would happen. Except that the raw materials will cost more to bring onshore, even if the TCFI factories could be setup (and staffed) in short order.
Any way you slice it, next years iPhones are likely to cost more than usual after the existing supplies run out.
Pesky things, details. And tariffs.
Well obviously you first need peasants.
So you need
1, a total collapse of society,
2, followed by a revolution,
3, mass starvation,
4, a gradual rise from subsistence agriculture, through low cost manufacturing to finally being able to do the most trivial assembly steps on someone else's advanced products
This isn't the sort of thing we can organize overnight. Even step 1 is taking more than a month
No need to bring back slave labour, just arrest everyone you need and then hand them over to privately run US factories^^^^^^^^^prisons. You can probably even charge them for room and board, so they end up paying for the privilege!
Just for once, Trump would even be following the Constitution; well, once you get past the little detail of "lèse-majesté isn't actually a federal offence, Sir" but that can surely be dealt with by a swipe of a Sharpie.
"Won't somebody think of the Children!"
Don't worry, Florida is: Florida lawmakers push legislation to weaken child labor laws
"Won't somebody think of the Children!"
These children are mine.They should be on my train. They’re essential girls! Their fingers polish the inside of shell metal casings. How else am I to polish the inside of a 45-millimeter shell casing? You tell me. You tell me!” – Oskar Schindler
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"We must tariff the robots to protect American jobs"
That's why we have labor unions. As soon as a company talks about installing robots, a "job action" follows. it's been a big issue in the car industry where the UAW is very concerned about headcount and car companies are trying to stay competitive with overseas factories that have shifted things over to automation.
At the price they sell for, why yes it would be. If Apple gave a fair share of the price to the people who build them. I believe it was $15 they paid for assembly them. How much do you pay for one again? (Oh yeah, and remember that year when Tim C got paid more than the entire ~one million chinese workers who built iStuff )
I’m sure the small army of people with their big carts scanning Walmart kerbside collections or making world famous chicken at Royal Farms can be retrained to assemble iPhones.
After all, consumer electronics, IT kit, domestic appliances, pharmaceuticals, furniture, clothing … used to be made domestically…. Until Corporate America (and being fair corporate Europe) moved this away.
Silicon Valley
Silicon Glenn
IBM Boca Ratten
It’s just wages, benefits and workers rights are SO impactful to the bottom line that Capitalism, MBA’s and bean counters made us fuck these people off and offshore, outsource and contract manufacture to those lovely people at TSMC and Foxconn.
Indeed our beancounter friends at Indian Business Systems (IBM) are continuing this good work with services, consulting and support to IBM India <corporate/cSuite Hi-5’s all round>
Don't look down on offshoring.
That is how the people in, eg, Korea, Hong Kong, Singapore, China, and India, were able to earn a living, educate their children, and invest in factories that made them the industrial powerhouses they are now. It is how people in Thailand, Vietnam, and Indonesia can make a living.
The problem in the US is that they did offshore all their industries, but did nothing to re-educate and re-employ the people whose jobs were offshored. Hence the rust belts.
Moreover, Americans insisted on not producing stuff in the USA that other people wanted, like chlorine free chicken and quality cars you can actually drive in Europe or Asia.
"As the cheap labour countries get better off they can afford to become less cheap."
It's not the cost of labor that's the issue these days for these types of products. If the PCB's were hand soldered, yes, but they aren't. It's just a bit of fiddly assembly that people are better at and a functional test. Even if the US's economy drops into the cellar and people will work for $1/day and a bowl of corn, it won't make it any more advantageous for companies to set up plants in the US.
You really should take a harder look at the success stories you are sharing.
Korea is dying, nobody h as kids because they are being worked to death. I wouldnt call that a success.
People like animals dont have kids when they are sad, South Koreans have the lowest number of kids in any country for all human history.
There are entire cities of component supply chains around the manufacturing in China and Asia more generally. Food doesn't grow in the supermarket, and neither do component grow in neat iphone bundles.
It'd be far easier to just grow Cocaine in the US rather than bring it in, and yet despite the huge market that doesn't happen. That's something you can turn from input to product with rudimentary chemistry and has a huge markup.
Doesn't happen, and you think that it's remotely feasible to do this with a component supply chain with much more exacting input/output tolerances and exponentially less potential for profit.
The skills in production, and the ancillary trades, where are those people coming from. It's an impossibility to compete with China on an Industrial basis for high tolerance low cost components.
If you can't make components, you can't make products.
"If you can't make components, you can't make products."
But then you simply import the components! Oh...
Maybe there can be some tariff exceptions for necessary components? There was another comment that worked that out, like, printing just the "Made in" sticker?
"It'd be far easier to just grow Cocaine in the US rather than bring it in"
Does the US have the climate that will work for it? I suppose that it wouldn't be too hard to set up greenhouses to have a tropical climate since the markup is pretty good, but that's mostly due to risk. If you lose 6t of market ready product in one go, that will impact the bottom line.
I presume so, it's a leaf that they need not fruit, so I'd be amazed if you couldn't produce it in the US. I'd expect it's purely the scale - it's cheaper on the scale needed to grow and refine in the producer countries.
I don't know for sure, perhaps there is some climate related reason but I'm going to put my chips on economic reasons. Like how much is a Kilo worth in Bogata vs on the Mountain, vs in NYC.
It's probably under a hundred on the mountain, under a couple grand in Bogata and tens of thousands in NYC.
I have no idea, I'm just guessing at figures
The US has mountains, it doesn't have mountains full of experienced coca farmers. The cost I mentioned is the cost of paying the farmer to grow and harvest a kilo of leaf for sale to the producers/refiners.
You can coca hydroponically, https://hydroponicshow.com/can-you-grow-coca-plants-hydroponically/ - This time the supply chain of relevant chemicals are abundantly available but skilled labour is not economically viable.
It's not the climate that's stopping you from growing sniff in the US, it's the cost of production for commodity consumed in the hundreds of annual tons.
Not sure this is the future many Trump voters envisioned for themselves.
Android phones are also going to be much cheaper than iPhones now, so despite all the sucking up Tim Cook did to Trump, it won't be his phones getting screwed in America, just his company.
Watch the worker bees pushing a Walmart cart with a scanner picking groceries, or picking in an Amazon warehouse ….. hey go watch Nomadland (great film).
Sure they can work an assembly line operations for (slightly) better wages… though vastly more than what you would pay someone at Foxconn China/India.
>Sure they can work an assembly line operations for (slightly) better wages
When we have millions of newly unemployed and highly skilled government scientists, air-traffic-controllers, FAA, OSHA, DoE experts etc
"Android phones are also going to be much cheaper than iPhones now"
How do you figure? The tariff that's good for the Apple, is good for the Android. Both are imported. Both get hit. Build them in the USA? Same thing for Apple as for Android. Only Android would be a bit typically cheaper, as it is now.
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Android phone cost $100, tariff $125 retail = $250
iPhone $1100, tariff $1400, retail $2500, call it $3000 for the inconvenience of having to do all this. It's not like you have a choice, who else are you going to buy an iPhone from ?
ps don't get clever and start looking at airfares to Canada, were also locking them so only genuine Freedom iPhones can be registered in the USA
pps. Reality. Somebody at Apple HQ decides a few $M of it's reserves should be in Trump coin and Apple get a special tariff exemption
So its ok to continue to exploit cheap labour working in poor conditions in other countries just so can have cheap(er) iPhones?
If most jobs are soon to be replaced by AI and/or robots and US have cheap power then onshoring manufacturing becomes feasible in the medium to long term.
If most jobs are eventually offshored (many service jobs can now be offshored) will there be anyone left in the US who can afford an iPhone anyway?
I mean, it is definitely not 'ok' to exploit cheap labor in other countries, but that is indeed how the global economy operates. Even if you make sure the phones are constructed using ethical labor and pay the extra, you would need to do that for the entire value-chain. (And I have bad news about where many of our metals come from)
Most jobs are not about to be replaced by AI. If onshoring happens, then robotics will take some tasks probably, but not all. Building up the factories and supply chains takes literally years. The US cannot manufacture the components and we cannot produce the raw materials. That is one reason you don't generally just drop 150% tariffs on a whim. None of this is how you suddenly fix a globally exploitative system. The US does not have a massive surplus of people looking for so called 'unskilled' labor jobs. Our unemployment is relatively low, and many people within the country work in specialized fields. It has been long enough since the bleed of manufacturing happened that we as a country are simply not the same pool of labor we were at that time.
US wages for factory workers may be much higher than some nations, I will in no way deny that a Chinese factory worker is way worse off than any non-slave in the US, but pay and benefits for US factory workers are not 'good'. Compared to the cost of living in the US, the wages are still generally exploitative, only less so. However, tariffs will raise that cost of living further. If you want to make the system less exploitative you don't just move where you exploit people, you make a more equitable system. Tariffs are essentially an additional tax on goods for consumers, and poorer people must spend a higher % of their income on goods. It is a way to move your tax burden to the poor. Tax cuts on the rich combined with tariffs, slashed govt. services, slashed govt. labor regulations and onshoring manual labor is not going to make a better county. It is simply cementing the oligarchy.
"Forrester branding [..] told The Register the "extreme volatility" of Trump's policies is unlikely to make Apple take such drastic action even if, as he believes, the iBiz could afford it"
I've said something similar several times already, mainly because it's bleeding obvious...
Whatever else one thinks of the practicality and likelihood of proposals to bring various industries back to the US and the issues surrounding that, one thing is certain. Virtually none of that (*)- and certainly nothing that requires a remotely serious investment- is going to happen so long as there's even a fraction of the economic uncertainty surrounding the US as there is at present.
There's a legitimate case (for example) for reducing dependence upon Taiwan for semiconductors (and not just for the US). But no manufacturer in their right mind is going to even consider investing in US fabs at a literal cost of several billion dollars a go when the case for that investment is based upon an economic situation that could change overnight.
(*) Trump-placating token gestures like running an extra shift at an existing plant aside.
" But no manufacturer in their right mind is going to even consider investing in US fabs at a literal cost of several billion dollars a go when the case for that investment is based upon an economic situation that could change overnight."
Even if Trump was not inclined to reverse course every 25 minutes and kept the tariffs in place throughout his term, those multi billion dollar factories are unlikely to be in full operation before Trump's term expires and a sensible administration takes over (Hey! It could happen.)
Seem like a good investment to you?
"before [the octagenarian's] term expires and a sensible administration takes over'
Given his age, I expect his term in this realm will expire before such factories are operational irrespective, whether or not Americans will be given a chance to vote.
Also, I expect India would be a better choice for an alternative production location than the US anyhow.
Yeah (LOL!) Foxconn. What a major fizzzzzzle THAT was. Foxconn built a building, 13,000 employees were to be hired, but that ended up being 1,000—and then maybe EV batteries will be made? Nobody is really sure. Yeah the iDigital manufacturing landscape really changed with that one. So I'm not expecting to see an American-made $3,000-$5,000 iPhone coming out of Trump's USA anytime soon.
>Yeah (LOL!) Foxconn. What a major fizzzzzzle THAT was.
It was a great success for all concerned.
A major announcement was made of multi-billion $ investment in US manufacturing.
The president got on TV at a multi-$Bn Foxconn site. The Governor campaigned on having brought $Bn of inward investment to the state.
Foxconn avoided a lot of tariffs and political damage by their announcement of a multi-$bn investment in US manufacturing
And all it cost was a $M for an empty site which they got a government bribe investment to pay for and then sold to amazon for a warehouse.
A dozen groups all benefited from a $bn investment announcement and it cost Foxconn less than nothing
I've spent decades in the electrical engineering field. Once we scoffed at the poor quality of Chinese-made circuit boards and components.
But you know what? Since about the start of COVID every single solitary lot of circuit boards - from low quantities through runs of 1000+ - I've gotten in the US have been awful.
Delamination, poor wetting, missing and wrong components, pick and place misprogramming, scratches / gouges / dents of every possible size.
China isn't just beating us on price, but in quality. How the hell are we going to assemble iPhones if we can't do a simple 12-layer board?
The same thing was said about Japanese products decades ago but over time they both improved quality tremendously while the US has remained stagnant at best and gone backwards at worst. One of the things I found most lacking in the original Chips Act was funding for improving and updating PCB and passive components manufacturing. Leading edge PCBs and passives are every bit as critical to state of the art electronics as chips are.
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I like how you say "simple 12 layer board" but you raise a good point, China is an advanced manufacturing nation which is capable of making woefully low quality shite all the way up to the very best quality consumer goods.
It's not what they're capable of, it's what you're willing to pay for that determines which you get.
There was a YouTube video by a guy using wood tools to turn large tree stumps into $6,000 dollar tables, so presumably he knows what he is talking about.
He ordered about $2,000 worth of tools from Temu and AliExpress and checked them out. Quality was from absolute abysmal to better than the best tools he found in the USA for much less money, and everything in between.
One of the worst was a tool where the instructions were literally an A4 sheet of paper with the word “Instructions” printed on it.
Labor cost in the US is probably less of an issue than most people think, and not just because of automation. There's also all the other ancillary cost which will be higher, such as the price of energy, logistics etc., not to mention that, in the case of something like the iPhone, there are no companies making most of the parts for an iPhone in the USA. Not just the chips, but the batteries, screens, "birdseed" passive components etc. Pre-Trump tariffs might have allowed for an iPhone "assembly" plant in the USA at an almost palatable cost increase to the consumer, but the rest of the supply chain is NOT Coming To America any time soon.
... in slave prison labor companies?
Let's see: Trash the economy, make people "work" for their "unemployment" (or "retirement") "benefits" and then set this new "workforce" to assembling iPhones?
As long as there are enough upper class / rich folk (aka "slave owners") around to keep on buying the products made in the gulags federally subsidized work camps, the stockholders win.
Hmmm... maybe this explains all that banning of DEI: paving the way to a return of slaves and slave owners?
Actually, there is this project 2025 advisor Mark Krikorian, the executive director of the far-right Center for Immigration Studies:
How easy? The west taught Asia to do it for us at lowest possible cost.
It would be foolish to think Asia didn’t take that football and advance it several yards beyond what they were taught: they assuredly improved every aspect of the task.
Whatever improvements Asia has made can definitely be transferred back to the west.
iPhones have only existed since 2007, there is nobody on Earth with more than 18 years experience putting together iPhones: nobody. Also, it is an order of magnitude less effort to replicate something that exists than to create it new from nothing.
“Oh it’s a big job to manufacture electronics,” oh really? More like commodity business, actually.
It isn't a question of manufacturing being easy or not, it's a matter of cost. Big companies exploit cheap labor worldwide for the good of shareholders, and many US pensioners depend of this to live.
I'm all in favour of giving more to workers and less to shareholders, but I doubt it is Trump's plan.
Consider that China has lower wages, but also much lower cost of living. There’s more than one Chinese guy or girl who worked two or three years at Foxconn, saved all the money they could, and that paid to go to university and become a lawyer. (Here in England I worked at an excellent company where a young Polish girl worked in the cafeteria with exactly the same plan).
How many Americans could go to university with three years savings from their job? Nobody working at McDonald’s.
How easy? The UK taught America to do it for us at lowest possible cost.
>It would be foolish t think America didn’t take that football and advance it several yards beyond what they were taught: they assuredly improved every aspect of the task.
I always said it was a mistake to allow America into the industrial revolution. If they had stuck to growing cotton and tobacco we would all be much better off.
I know it sounds alarmist but one day they will be making cars every bit as good as European ones.
"Whatever improvements Asia has made can definitely be transferred back to the west."
"Whatever"? Try "the immense number of improvements".
It goes beyond that. If you don't have a work force involved in something on a regular basis, the skills atrophy. I know my engineering improved by leaps and bounds when I also was the one making the stuff I designed. Since I have a tendency to over-complicate designs, being the one building the tools and the first articles taught me how to simplify. Once I had everything sorted, I could teach others how to make the widgets in production and watch them for hints on what improvements can be made.
There is also the serious problem of US business attitudes and practices.
Over a 5 year period, I moved all our critical material suppliers from the US to SE Asia. In every case the technical capability was excellent, but the business people lost our existing business by being were variously indecisive, uncommitted, outright dishonest, or too lazy or greedy to persist with something difficult, giving up rather than advancing their capability.
I never had any of those problems with our suppliers in SG, TW, TH, MY. They were decisive and committed - we got a fast yes or no. In particular they would never give up because it was got hard.
"iPhones have only existed since 2007, there is nobody on Earth with more than 18 years experience putting together iPhones: nobody."
What a load of shite! You think someone working an assembly line for whatever product has to start off at apprentice level when moving to a new factory, or the existing factory brings in a new product line? There are no skills specific or unique to assembling an iPhone. Anyone skilled in assembling electronics goods on a production line, whether it be a Sony Walkman or the latest shiny iPhone have basically the same skills which may have been acquired over far more than the 18 years since the first iPhone rolled of the the production line. And just to be clear, those workers assembling the first iPhones were probably transferred from other mobile and smart phone lines or poached from other factories. The iPhone was not the first mobile phone and not even the first smart phone, FFS..
Here's how America will "make" the iPhone:
- China makes the iPhone as before, minus printing "Made in China".
- The "unfinished" iPhone will be exempt from tariffs.
- A factory full of undocumented workers will laminate a "Made in USA" label on the phone.
Voila! Trump will claim iPhone manufacturing has returned to America, and his MAGA supporters will eat it up.
There is a bit of truth in that, many moons ago a temp job I had in Manchester was in Fujitsu ala ICL also known as Design to Distribution (D2D) where fully made PC's came in by the pallet load, we unscrewed the 4 thumbscrews to remove the case, inserted a PSU, connected the connectors, and reassembled and placed back into the exact same cardboard box and then it had an assembled in the UK sticker put on it. This was in the late Eighties early Nineties when RAM was so expensive we used to be randomly searched for RAM modules :)
They were possibly breaking the law, but I'm neither a lawyer nor a Govt. inspector. There were rules on when a Made/Assembled in Britain" sticker could be used and there had to be a reasonable amount of local input to the final product to meet the specs. Maybe they found a loophole? Who knows, it was a long time ago and Govt "rules" are often full of holes.
Cook said "it would cost me 40 percent to bring it home," which he said wasn't a reasonable thing to do.
If a homemade iPhone costs Cook 40% more to manufacture and the iPhone has 200% markup, and Apples passes the additional iPhone cost straight through to its customers, the customer only pays 13.33% more
Of course, the higher price may mean Apple's revenues decline by, say, half the new markup -- say, 6.66%. *That* drop is what Tim Cook is truly avoiding. That, and all the risk and work of homeward shoring, and the loss of the Chinese market
I actually think it is an excellent idea to build iPhones in the US; the price premium is such that it will be cheaper for US citizens to travel abroad and do a grey import: everyone benefits: phones still made in China, countries get increased tourism, US citizen happy they got a bargain and (albeit briefly) saw the world outside of the US, MAGA supporters happy as phones made in the US, but they can proudly show off their new shiny brought on their foreign trip…
ifixit did a breakdown on an iPhone16 and claimed the parts on a $1099 retail unit cost around $550 - so 100% markup which is pretty typical for that kind of product.
Remember Apple also have the costs of designing it and writing the OS - so their official profit margin might be more like 25%
I'm wondering at what point China [et al] decide they've had enough & just park all their ships for a while?
"Until the additional cost to unload is below <name percentage>, we're no longer shipping - let us know when your stocks run out. Oh, you still running Just In Time stock management? That's a shame."
China can also slightly reduce the cost of items shipping to Europe, Japan, Australia and Canada to increase sales and keep their factories running.
Last tariffs there was a Chinese company making American-style cowboy heads. Unsellable outside the USA. They sadly went bankrupt. But most should be able to survive.
... is exactly telling that US can no longer manufacture anything "because".
Sure, US can' manufacture expensive phones with the same enormous profits for a few shareholders China allowes. And that's the only reasong of that "because". Some people got so used to be extremaly rich exploiting workers oversee they don't want to be a little less rich.
This idea western countries could live just on finance or some kind of "services" is what brought populism again in power. That kind of economy can sustain only a relatively small part of the population. The others become "working poors" - forced to accept low-paid jobs, or live of subsidies. Subsidies NOT paid by the richest one that dodge taxes as they like, but by those "middle class" that survived somehow.
Lack of "vocational skills"? Bullshit - nobody is born skilled, you have to train workers. I've heard that over and over, companies don't want to invest in training, they want already skilled workers (better if they are immigrangs acception low wages and dire work conditions) again to "maximize shareholder value".
Now, maybe you can't build very cheap products in US without raising their prices - but we have to pay everything almost nothing? - but even there there are high profits to be made, see Amazon.
But if someone is telling me extremely expensive electronics can't be made in US (or any western country) they are simply lying to protect extremaly high profits, who cares if everything else crumbles? That was what lead to the French Revolution. An elite that didn't want to renounce to their extremely privileged lives - and paid with thei lives.
"What a dream job isn't it ?"
Not really, but....
If it's a job close by one can get to without owning a car, pays ok and the hours are flexible to match family responsibilities, it might not be too bad. I had a woman that worked for me with hours based around her children's school. She was doing assembly work, was good at it and nobody else would work around her hours. For me, it was hard to find people with the skills I needed so I was happy to get somebody that could do the work even if they couldn't work a typical full-time shift. We both win.
"One's a world power with extensive cutting-edge electronics manufacturing empire, the other is America"
Question for the reg, when you wrote this did you realise this is what Trumps argument is?
I am certainly not saying he is right, I disagree with this daftness but Trump is arguing what a lot of people have argued for some time (until Trump said it) that the west needs more manufacturing. Complaining that it gets off-shored and we dont make things anymore (UK based here and yeah we do) because services have grown sharply but manufacturing hasnt grown as fast.
It has been great watching people who argue against me for tariffs and bringing back manufacturing now 180 and argue that tariffs are bad and off-shoring low paid jobs is a good thing. I am also amused by the switch in Americans arguing, where democrats claim the republicans are all for slavery only to cry that the border is closed and where will all the under-paid labour come from. Or cries against a 'puppet' President after 4 years of Biden with the serious cover-up of his mental condition.
Yes, that is his argument, sort of, his argument is that it's the sneaky chinese who have dishonestly advanced far beyond the US, and that this is unfair and must be punished.
You are essentially correct that stripped of the Racism, is the kernel of a valid statement, manufacturing is a strategic national interest as is farming, and that should be assisted.
The problem is he's long on Racism, and short on the Why - e.g. where are the component cities that supply all these factories? Where is the deep and broad pool of educated people with skills in the relevant chemistry and industrial process engineering for factories / chemical plants of suitable scale.
What about the input supply chain, and waste disposal, the heating, cooling, water and power requirements. These are all long term productive investments with decades of payback, that's antithetical to the US mode of Government.
So Don Tariff has had his wings clipped by his handler and "Paused" the tariffs, he's a putz, but a useful idiot. A useful idiot can make a good point, he's still an idiot.
It depends on what the vision for the country is. There was a great xkcd yesterday likening Trump's tariff calculation to buying pizza. I buy pizza regularly from the same pizzeria but they buy nothing from me so there's a huge deficit and the pizzeria needs to be punished with tariffs. To extend this analogy, what do I do? Every time I buy a pizza I double it's price and put the difference in bank. Eventually I'll have saved enough to buy a pizza oven, the big paddle thing, wood, ingredients, etc. and with practice I might be able to make pizzas just as good and then I won't need to buy pizzas from the pizzeria. Independence - yahoo.
This is what Trump is assuming will happen, but it's only a good idea if I want to spend my time making pizza, and the pizzas will be more expensive making them one at a time so I won't even recoup my costs unless I scale up and run a pizza business, which means giving up my job as an engineer who earns a decent wage for a three-day week to become a pizzeria proprietor earning a bit above minimum wage for a 100 hour week. Now I could conceivably consider this for pizza - I eat a lot of pizza and I know how to make it - but I've got an even bigger deficit with Tesco and I'm buggered if I'm going to start making my own baked beans and bog roll.
So, back to the vision for the country - assuming Trump's plan works it might not be a bad idea to bring high-tech manufacturing back to the US but he's put 37% on Bangladesh. Does the US really want to try to compete with people earning a few dollars a week making teeshirts and shoes? Whatever industry he brings back to the US will suffer from massively higher wage costs and hence prices, meaning that they'll only be saleable in the US and companies like Apple will have to maintain their offshore operations to compete in the rest of the world.
https://xkcd.com/3073/
I love your analogy because intentionally or not you've also valued all expertise at zero and assumed the equipment is what make pizza you want to eat, not the labour and craftsmanship.
Which while saving money, you've not acquired any skills, ingredients, practice; so all that's happened is you have no money for Pizza and an oven you don't know how to use that is not safe to use in your home, that has cratered in value when you try to sell it. Far from saving money on Pizza, you're now reduced to looking longingly at the discarded cardboard boxes of your less discerning neighbours.
I make my own Pizza dough and while I prefer my sauce and crust to most, it's got to be some of the most expensive Pizza I've ever eaten. Deadline Pizza is my version of the Pomodoro technique,
not to be overused, but it's quite good for focused efforts with a reward for the late night efforts.
Trump doesn't have a vision, he's a moron. But he's exposing the coercive nature of the US and how much of the costs we all pay are down to the whims of the powerful, i.e. completely voluntary, so utterly dismissible.
I like the idea of a Trade deficit with Tesco.
It'd be a good idea to get the inputs to high value manufacturing, the cheap rent, the cheap or free education of high quality, access to equipment and testing tooling.
That would let people experiment with what they want and let small scale stuff flourish. I don't think you can transplant high-complexity markets if low complexity markets for the same or related products are unsustainable.
Trump is doing what he did when he suggested that Bleach might be useful to treat Covid. It makes sense, to a certain rudimentary framing, it's just when you try to apply reason to the underlying concepts it falls apart because he's a moron.
sounds like you need to adjust that tin foil hat you're wearing.
I Swear! this site is so full of TDS and MSDS (Microsoft derangement syndrome) it makes searching for intelligent analysis in the comments like searching for a needle in a haystack.
Why is everyone here a socialist Linux gearhead? Is it because thats all thats left in British Tech?
we get it! Trump and R bad , Dems and whoever had their hands up Bidens ass to simulate him being alive - Good!
Everything MS bad....
Capitalism Bad
Marx... Good....
You need to learn to read. Trump is great. The deranged shithead can't stop telling on himself, and I don't have to listen to credulous simpletons wang on about freedom and democracy, and human rights and upholding the law, and world policemen while openly funded Nazis.
Now they openly tell you they are incompetents. who broadcast war crimes on Whiskey leaks
Trump has never successfully run a business. He has been successful in convincing others to invest in his "concepts". He doesn't recognize that a "concept" is not a "business plan". The closest he has ever come to running a business is "The Apprentice" reality television show. Of course, reality television is anything but reality. In Trump's mind though, and in the mind of his supporters, he was a real business star.
Made in the USA. Nobody there can afford them. But over the border in Canada and Mexico, the Asian built models, selling for the standard $1000 price are hotly smuggled across the borders in cases of smoked meat and mezcal to hide the scent from tech sniffing dogs…
The new ford Fairlane SUV , harkening back to the 50’s, which gets one gas station to the mile is rolling off the production line at a highly affordable $160000 starting price.
In other news, Japanese robots have just cut the ribbon on their own Jeep plant in Wyoming.
Welcome the world of Agent Orange and the 1%. A dystopian future
If a country has mandatory standards for how workers should be treated (e.g. maximum working hours, bathroom access, paid holiday, parental leave, fair grievance procedures) then those standards should be applicable almost in full (with exceptions for access to any private service where existing public services are of a comparable standard, and affording licence to assess equivalence of remuneration in terms of equivalence of purchasing power) to everything imported into that country from anywhere else in the world.
Anything less would be equivalent to saying "Those conditions are not good enough for our own workers at home, but they're fine for those people".
That makes no sense whatsoever.
Firstly purchasing goods or services from someone or some country only implies you require what they can provide.
Secondly it's logistically unfeasible, I want a mango, you have a mango tree. How do you propose I enforce a minimum set of working conditions on you, the owner of the mango tree.
Me: I want a mango but only if you're signed up to the Working Time Directive.
You: It's a tree, don't really need fixed hours.
Me: Do you have a policy on workspace discrimination?
You: Do you want the mango or not?
Me: I'll not partake in stoned fruit from such flagrant violators of Human Rights.
Thirdly the septics are against a right to food - they simply don't have anybody to trade with who possess a worse record of human rights.
As Trump cannot think, he hasn't cottoned on to the fact that greed instigated offshoring manufacturing out of the US (or anywhere else in the Western world); Company greed, CEO greed and Union member's greed. How many union members would work screwing in little screws for wages that Chinese workers get? I reckon a fully US made iPhone would cost over $3000.
If the raw materials and parts are taxed 0% but the finished product is taxed 54%. There is NO reason that iphone won't be made in the USA as howsoever costly the US labor force and logistics are, they will be far less than 54% of the finished product for such a standardized product. But if someone is doing a lazy job of the same customs duty on finished product as the parts, then no incentive for iPhone or any manufacurer to do so in the USA when they can make them overeas at lower cost and distribute it across the world and not just the USA.
