Tim Cook, Apple’s new CEO has publicly mentioned that the iPhone -which represents 50% of Apple’s business- may be “one day” assembled in the United States. While this will certainly not happen overnight, this may give hope to a consumer electronics manufacturing industry that is quasi-inexistent in the USA.
Clearly, it would be unrealistic to think that the next iPhone would be manufactured in the U.S next year – at this point it seems extremely unlikely, if not simply impossible. However, the notion that a more robust consumer electronics manufacturing business can be built in this country is very interesting. Apple could for example start moving some production back to the U.S on low-volume products like the Apple TV box, or the upcoming television slated for 2013, which is still a rumor at this point.
But let’s not kid ourselves: although Tim Cook may be more open to the idea that Steve Jobs seemed to be (he once said to President Obama: “the jobs aren’t coming back” on this very topic), the execution of such a move back home would be slow.
China has not become a manufacturing powerhouse overnight, and it would be foolish to think that “cheap labor” is the only advantage that is at play. Manufacturing is an art, and it is a process that is constantly refined and improved. It’s like any other skill: the more you do it, the better you get, and it’s fair to say that China has had a lot of practice. Low wages are not the defining factor (although it does play a part) anymore. Infrastructure, organization and ample supply of trained workforce. There are plenty of low-wage regions in the world, but only one city like Shenzen.
But it’s not crazy to believe that this skill set can be brought back, nurtured and grown here at home. It’s possible, but it also needs to be done in a way that ultimately makes business sense. And of course it’s not only about Apple: a lot of high-tech devices and computers have chips and software designed in the USA, yet they are ironically manufactured in China.
This is also about Motorola, HP, Dell, etc… That said, it’s fair to say that among this group, Apple is the one company that can “afford” taking risks on something like this. Can Apple actually apply its “Think Different” moto to make a significant impact on the U.S manufacturing business? Only time will tell.
What do you think? Is this a genuine thought or merely a communications stunt? Do you see consumer electronics manufacturing come back to the U.S?
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