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Why moving the iPhone production to the US would be useless and impractical

We have previously looked at the impracticability of Trump's appeal to Apple to make iPhones in the US, and Tim Cook has spoken on numerous occasions about skills, not labor costs.

There is also the fact that the move towards fully automated production means that American jobs that were created would soon disappear. And now a new analysis shows how little the US would win economically, even if it could be done …

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The WSJ echoes earlier remarks about the logistical barriers.

It is too late for the US to bring the entire supply chain back. The time to act would have been in the early 1980s, before Western manufacturers started outsourcing the assembly of personal computers and many components to East Asia.

One of the biggest problems – the lack of skilled production workers – is worse than it seems, given the seasonal nature of the iPhone production.

The bigger [problem with] American assembly […] would be the inability to quickly add hundreds of thousands of employees when new phones are launched, which is only possible in Asia.

But it says that even if it were possible, the US financial gain would be minimal.

The factory workers who assemble iPhones in China only contribute 1% of the value of the end product. The shareholders and employees of Apple, who are predominantly American, achieve 42%.

Apple has so far largely escaped the consequences of the growing trade war between the US and China, but the situation can get much worse.

Photo: AP Photo / Kin Cheung


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