Apple reportedly believes Chinese factories faster, more flexible than U.S. counterparts

Apple reportedly believes Chinese factories faster, more flexible than U.S. counterparts

According to The New York Times, not the cost of labor, not the cost of components, but rather the speed and flexibility with which Chinese factories can respond to iPhone and iPad manufacturing demands is reportedly the reason Apple prefers them over their U.S. counterparts.

One former executive described how the company relied upon a Chinese factory to revamp iPhone manufacturing just weeks before the device was due on shelves. Apple had redesigned the iPhone’s screen at the last minute, forcing an assembly line overhaul. New screens began arriving at the plant near midnight.

A foreman immediately roused 8,000 workers inside the company’s dormitories, according to the executive. Each employee was given a biscuit and a cup of tea, guided to a workstation and within half an hour started a 12-hour shift fitting glass screens into beveled frames. Within 96 hours, the plant was producing over 10,000 iPhones a day.

This isn't unique to Apple, of course, but Apple's popularity and profile, fueled by their exceptional supply-chain management, gets their name in the headline.

For a complete run down of the realities of modern manufacturing, and examples including Steve Jobs' response to U.S. President Obama, give the full article a read.

Source: New York Times

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Rene Ritchie

Editor-in-Chief of iMore, co-host of Iterate, Debug, Review, Vector, and MacBreak Weekly podcasts. Cook, grappler, photon wrangler. Follow him on Twitter and Google+.

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Apple reportedly believes Chinese factories faster, more flexible than U.S. counterparts

44 Comments

Of course they are faster and more flexible when they live in the factory and are forced to work otherwise they are fired or killed.

The problem with this analysis is that the speed and flexibility is not separable from the cost of labor. In the example here, part of the extraordinary turnaround was because there were employees living in dormitories, who could be awakened at midnight without warning and taken to a 12 hour shift. At Foxconn, these laborers get that room and board (in a room shared with up to 8 people), and 31 cents an hour. Even if the US (or Canadian) government were to allow such conditions, you would have to pay quite a bit more than 31 cents/hour for workers to accept them.
This is not to take away anything from the skill and extraordinary management capabilities of Chinese companies. This time lapse video shows a hotel built from the ground up in 6 days. Regardless of the cost of labor, the precise logistics of this operation are astounding. I am not sure how many US/Canadian firms are capable of this symphony of coordination at any price.

"I am not sure how many US/Canadian firms are capable of this symphony of coordination at any price."
None that I know of. You are not going to get any American or Canadian worker living in the sorts of conditions that the Foxconn factory workers live and work for the wages they work for. I would actually think that's a good thing.

You missed the point. The hotel construction was remarkable for the coordination of materials and stages, e.g. the moment the framing was complete, the plumbing materials and crews were ready to begin laying pipes, the moment pipes were done, the drywall was ready for placement, and so on. That sort of management requires a set of skills far above and beyond just cheap labor.

Could also explain the antenna issue and battery drain issues. When a process is so on the edge the unexpected test cases emerge and its too late.

Huh? They didn't specify which phone this was.
Also, the antenna issues were well known in Apple before the phones release. The engineers warned Jobs and Ive that it might be an issue but their concerns fell on deaf ears.

iPhones are cheap because carriers subsidise them, not because they're made in China. The fact that they're made in China simply allows Apple more profit on the phone.

They think that because they are. That's why the REST OF THE WORLD manufactures there too. How is this just am Apple issue? Sensationalist BS. Apple gets page hits, I guess. Hope your advertisers are happier than your readers.

I agree with Apple 100%. Looking past Foxcons problem (not Apple's problem), there is no denying the labor force in the Asian markets. That drive and resource is simply not here or anywhere else. In the US, the government doesn't help the matter with interference, nor does the damning demands of unions.

Damning demands of unions? Wow. Well, uh, unions got you that overtime pay, those vacation/sick pay, and those weekends off so be glad you're not the one working for $.35 per hour for dozens of hours on end.

Abject poverty, oppression of civil rights, and indentured servitude does have it's advantages. Damn the world for wanting to have favorable working conditions. Next they'll be asking to use the bathroom stalls during their 14 hour shifts. That's what the mason jar at your desk is for buddy!

This is the whole ball game folks. This is why you hear politicians tell us we are not competitive. Corporations want to lower labor costs to near zero but reap maximum productivity with awful working conditions. This why you hear politicians slam labor unions and try to convince us that racing to the bottom is a good thing.

This makes me think that the Asian factories aren't passing on the cost of the suicide nets to their customers to maintain a low cost to suicide ratio.
That's cheating!

I suggest to read the same article at tuaw. They go a little more in depth into Apples's reason than this piece and it makes more sense. Sorry but this very brief article does make things sound worse than they are. Apple has more than just the one reason Rene writes about for manufacturing in China, so either read the NY Times article in full or take a look at tuaw for a summary of said article.
Also, the dorms are for the thousands of employees that are mainly from out of town and obviously don't get paid enough to cover rent. Chinese are fairly practicle. What's the sense of looking for a place if 1) expensive when you take utilities and transport into consideration and 2) if you're there alone because single or sending money home to family. Remember, they have a 1 child policy so a lot hinges on that 1 child earning money and sending it home to help the family. Sure it's not ideal but given there is always someone to take your place, what would you do? The US is like that now in some ways - supply of labour higher than demand for labour .

Can anyone imagine how expensive an iPhone or an iPad would be if it were made here? No thanks.

It wouldn't be because Apple could still make really good margins given their pricing on items. But even if they translated it directly, the price difference was estimated to be about 20% more.

oh yeah it has nothing to do with having a big profit margin...do they have any factories at all in the US making iphones etc

Spoken like someone who has not done one day of hard manual labor in your life. Count yourself lucky.

And yours is spoken like someone who likes to get paid a ton of money for minimal work. Unions can be both good and bad, and whether you like it or not, they do create a lot of BS.

apple choses china, for the same reasons everyone does. first of all its cheap and second, americans only want to complain about not having production plants at home, they dont actually want to work in them! were used to cheap electronics from china, and we want to keep those, but we love complaing about chinas labor laws because we are fooled into thinking we are put in place to save the world from itself. this works out nicely as it gives americans the impression of themselves that they are conscious, but lets them continue to live in their little propaganda bubble, while corporations continue to make profits from exploiting the labor we love to hate and hate to love.

That's the best way I have seen of putting a simple point.
The point is not only correct for the USA but also most other 1st World and quite a few 2nd World countries!
People will harp on about how these contractor factories are stealing Jobs but if they brought the employment back to the USA or UK or whichever country it happened to be they would turn their noses up at the work and call it slave labor because the working day is longer than they want.
It's like the people that walk around waving their Made in China phone and driving their vehicles with many component parts made in China and telling people that they will never buy anything made in China.
I was in Walmart about 36 months ago and picked up a bag of Candy, I used to purchase to drop off at an assisted living that my Grandma was in at the time. Happened to look at the rear and it said Made in China on the bag. Heck, even many of the major brands of Dog food are either produced in China or component ingredients are produced in china.
We live in a World of hypocrisies and now businesses that have production done in China, India etc are being blamed for the lack of jobs. The lack of jobs is because we as a people want luxuries at lower and lower prices.
It is not the companies faults, they are doing what we want, it is not the fault of the Chinese companies that tendered for the contracts to produce these products.
You are right, IT IS REALLY OUR FAULTS!

Nice looking at all the excuses made for Apple by those that want to apologize for their obscene profit taking. But Apple isn't alone. Nike, HP, Tommy Hilfiger, P&G, etc etc etc all do the same thing. It has to do with American (& other countries), consumerism & wanting it now at the lowest price possible. Which one would think would disqualify Apple's offerings based on price but I digress.
But of course politics plays a major role here too. If you are a flaming leftist (which populate the tech industry by & large), then you are more forgiving of said company with their corporate greed & labor policies. Apple talks a good game on their website, as most companies do, about their environmental awareness & fair labor practices. Then they rake you over the coals with outrageous profit taking & corporate greed.
When did Apple last give to charitable works? Steve himself said the company wasn't profitable enough to give to causes like the Bill & Melinda Gates Foundation. yet no outrage from the leftist politicians & the 'Occupy" movement cry babies is directed at Apple. Odd yet totally expected hypocrisy.

I was really hoping the iMore crew would comment on this in more depth. The site often talks about the role of tech in our lives- how much more important of an issue could you come up with? What is the responsibility of consumers for the conditions used to create the products we love? Do corporations like Apple (and many others) have a responsibility beyond their customer base and shareholders? Are we our brother's keepers or is it really an Ayn Randian free for all? How those questions are viewed inform the legitimacy of our current economic model.

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