Greg's bite: What if Apple assembled its products in the USA?
TweetFollow Us on Twitter

Greg's bite: What if Apple assembled its products in the USA?

By Greg Mills

On the day iPhone is likely to be announced for Verizon, a study I found looking at the profound effect on the US economy of Apple outsourcing assembly of iPhone to China is particularly interesting.  

Can you believe Apple CEO Steve Jobs could put Apple on track to hire as many as half a million Americans who are currently out of work, while only marginally decreasing Apple's stellar profits? Jobs could add over US$10 billion a year to the national payroll simply by bringing assembly of Apple products home. Our government should make such a move as easy as possible by making the US employer environment more conducive to such a move.

I did an article recently on Apple's industrial footprint in China. While the subject of that article was the nature of Apple's business dealings with contractor assembly companies and their employees in China, another issue came to light recently in a study done by the Asian Development Bank Institute, located in Japan.  See http://www.adbi.org/files/2010.12.14.wp257.iphone.widens.us.trade.defici... . On its face, Apple's decision to "import" fully assembled iPhone from China increases the US trade deficit with China by 1.9 billion dollars per year.  

That number isn't really as bad as it sounds, as the actual money paid by Apple for assembly in China was estimated to only be about $6.50 each. While that totals only $73.5 million, trade deficits are calculated upon the total assembled value of the product being exported. While $73.5 million dollars a year is enough for most of us to live on gracefully, it is not the 1% iPhone purportedly contributes to our trade imbalance with China, a figure commonly bandied about.

It is well known that iPhone -- and for that matter just about everything Apple makes and sells -- is assembled in China. The bottom line at the world's second largest company has swollen in part due to a business plan that keep prices down by sending assembly jobs overseas. The accounting for purposes of calculating our trade deficit with China is a bit deceptive. The truth is, with a profit margin of over 60% on an iPhone, Apple could hire Americans to assemble iPhone and still make a tremendous profit. Would that be hard to do? Yes, but the positive results for the United States would be profound and certainly survivable by Apple.

Based upon 2009 sales numbers of 11.4 million iPhones sold over seas, Apple could have added  $5.7 billion to US exports that year. With sales of iPhone soaring, these numbers are just a fraction of what is expected this year. With US assembly costs rising to an estimated $68 per US iPhone from the $6.50 per Chinese iPhone Apple would still make a 50% profit.  

If you figure, based upon global sales of 25,000,000 iPhones alone, sold in 2009, at $68 per iPhone, the US economy would have seen 1.7 billion dollars added to the national payroll that year. Rough numbers indicate that if Apple took a slight hit on its bottom line on the iPhone and only made a 50% profit instead of 60% by moving assembly of iPhone to the US they could have hired 68,000 Americans who were out of work.  Isn't 50% gross profit pretty darn good?

If you rerun the iPhone numbers based upon current estimates of up to 60,000,000 iPhones to be sold this year, at $68 per unit, Apple could add over four billion dollars to the American payroll and hire 163,000 assembly workers by simply assembling the iPhone in the USA.  

If you add the iPad to the situation, based upon similar numbers, if Apple makes 65,000,000 iPads in 2011 they could hire over 300,000 Americans by moving iPhone and iPad assembly alone to the USA and add up to 10 billion dollars to the US economy in salaries. Adding Macs to the numbers could add even more. I suspect the hit on the stock prices of Apple wouldn't be that hard, as the Wall Street buzz from making such a move would be overwhelmingly positive.   

If Apple moved assembly to the US, some people would be grateful and buy Apple instead of products from companies that assemble their products in China. Could increased sales and an improved US economy make this move by Apple a wash economically? I think so, but I am not an economist. Were Apple to do this, federal tax credits and concessions by states willing to make the Untied States and their state a more congenial host for employers would be required.  Congress should figure out a way to move US jobs back to the USA.     

Jobs should discuss Apple's terms for moving assembly of its product to the USA with President Obama. With unemployment and the economy putting him over the barrel, the Apple CEO could play his hand well to obtain concessions and tax advantages to move jobs from China back to the USA.  Imagine at the end of an Apple event if Jobs were to say: "Oh one last thing, we at Apple are grateful for the American dream that our success represents. We have decided that while it might hurt our bottom line a little bit, Apple is committing to begin the process of moving our product assembly lines back to the Untied States and making Apple a 'Made in the USA' company.  If you like that idea, could you please buy Apple stock and help us finance that?"  

That's Greg's bite for today.

(Greg Mills, is a Faux Artist in Kansas City. Formerly a new product R&D man for the paint sundry market, he holds 11 US patents. He's working on a solar energy startup, www.CottageIndustrySolar.com using a patent pending process of turning waste dual pane glass into thermal solar panels used to heat water. Greg writes for intellectual web sites and Mac related issues. See Greg's art web site at www.gregmills.info ; his email is gregmills@mac.com )

 
AAPL
$117.89
Apple Inc.
+1.42
MSFT
$47.85
Microsoft Corpora
-0.14
GOOG
$541.65
Google Inc.
+4.15

MacTech Search:
Community Search:

Software Updates via MacUpdate

ForeverSave 2.1.3 - Universal auto-save...
ForeverSave auto-saves all documents you're working on while simultaneously doing backup versioning in the background. Lost data can be quickly restored at any time. Losing data, caused by... Read more
Voila 3.8.1 - Capture, annotate, organiz...
Voila is a screen-capture, recording, and annotation tool that is a full-featured replacement for Mac's screen-capture and screen-recording capabilities. It has a large and robust set of editing,... Read more
SyncTwoFolders 2.0.6 - Syncs two user-sp...
SyncTwoFolders simply synchronizes two folders. It supports synchronization across mounted network drives and it is a possibility to run a simulation showing in a log what will be done. Please visit... Read more
Duplicate Annihilator 5.1.1 - Find and d...
Duplicate Annihilator takes on the time-consuming task of comparing the images in your iPhoto library using effective algorithms to make sure that no duplicate escapes. Duplicate Annihilator detects... Read more
Cobook 3.0.7 - Intelligent address book....
Cobook Contacts is an intuitive, engaging address book. Solve the problem of contact management with Cobook Contacts and its simple interface and powerful syncing and integration possibilities.... Read more
StatsBar 1.9 - Monitor system processes...
StatsBar gives you a comprehensive and detailed analysis of the following areas of your Mac: CPU usage Memory usage Disk usage Network and bandwidth usage Battery power and health (MacBooks only)... Read more
Cyberduck 4.6 - FTP and SFTP browser. (F...
Cyberduck is a robust FTP/FTP-TLS/SFTP browser for the Mac whose lack of visual clutter and cleverly intuitive features make it easy to use. Support for external editors and system technologies such... Read more
Maya 2015 - Professional 3D modeling and...
Maya is an award-winning software and powerful, integrated 3D modeling, animation, visual effects, and rendering solution. Because Maya is based on an open architecture, all your work can be scripted... Read more
Evernote 6.0.1 - Create searchable notes...
Evernote allows you to easily capture information in any environment using whatever device or platform you find most convenient, and makes this information accessible and searchable at anytime, from... Read more
calibre 2.11 - Complete e-library manage...
Calibre is a complete e-book library manager. Organize your collection, convert your books to multiple formats, and sync with all of your devices. Let Calibre be your multi-tasking digital... Read more

Latest Forum Discussions

See All

Playdek has Annouced a Delicious Thanksg...
Playdek has Annouced a Delicious Thanksgiving Sale Posted by Jessica Fisher on November 24th, 2014 [ permalink ] Playdek, makers of | Read more »
Pair Solitaire Review
Pair Solitaire Review By Jennifer Allen on November 24th, 2014 Our Rating: :: ADDICTIVE. SO ADDICTIVEUniversal App - Designed for iPhone and iPad Welcome to your new ‘five more minutes, oh no, why is it dark outside’ addiction.   | Read more »
DryGin Studios Release a Free-to-Play Ve...
DryGin Studios Release a Free-to-Play Version of Bio Inc Posted by Ellis Spice on November 24th, 2014 [ permalink ] Universal App - Designed for iPhone and iPad | Read more »
The Hunted Review
The Hunted Review By Jordan Minor on November 24th, 2014 Our Rating: :: A GROAN IN THE DARKUniversal App - Designed for iPhone and iPad The Hunted’s multiplayer thrills are overshadowed by bland visuals and average gameplay.   | Read more »
Need for Speed No Limits has Been Unveil...
Need for Speed No Limits has Been Unveiled for iOS Posted by Ellis Spice on November 24th, 2014 [ permalink ] EA and Firemonkeys have announced Need for Speed No Limits, the next mobile installment | Read more »
Space Expedition Review
Space Expedition Review By Jordan Minor on November 24th, 2014 Our Rating: :: ONE SMALL STEPUniversal App - Designed for iPhone and iPad The only thing boring about Space Expedition’s lonely journey is its title.   | Read more »
Ubisoft Gives Everyone Two New Ways to E...
Ubisoft Gives Everyone Two New Ways to Earn In-Game Stuff for Far Cry 4 Posted by Jessica Fisher on November 21st, 2014 [ permalink ] | Read more »
Golfinity – Tips, Tricks, Strategies, an...
Dig this: Would you like to know what we thought of being an infinite golfer? Check out our Golfinity review! Golfinity offers unlimited ways to test your skills at golf. Here are a few ways to make sure your score doesn’t get too high and your... | Read more »
Dark Hearts, The Sequel to Haunting Meli...
Dark Hearts, The Sequel to Haunting Melissa, is Available Now Posted by Jessica Fisher on November 21st, 2014 [ permalink ] Universal App - Designed for iPhone and iPad | Read more »
Meowza! Toyze Brings Talking Tom to Life...
Meowza! | Read more »

Price Scanner via MacPrices.net

Jumptuit Launches One-Tap Windows 8.1 iTunes...
Jumptuit has launched Windows 8.1 support for One-Tap iTunes Sync. with which Windows 8.1 users can now easily sync their iTunes libraries with Microsoft OneDrive. Jumptuit provides easy access from... Read more
CEA Study Finds More People Recycling Electro...
A new study by the Consumer Electronics Association (CEA) finds that electronics recycling receives the continued and growing support of consumers. According to the CEA,s Recycling and Reuse Study,... Read more
15″ 2.2GHz Retina MacBook Pro on sale for $17...
 B&H Photo has the 2014 15″ 2.2GHz Retina MacBook Pro on sale today for $1749. Shipping is free, and B&H charges NY sales tax only. B&H will also include free copies of Parallels Desktop... Read more
27-inch 3.5GHz 5K iMac in stock today and on...
 B&H Photo has the new 27″ 3.5GHz 5K iMac in stock today and on sale for $2299 including free shipping plus NY sales tax only. Their price is $200 off MSRP, and it’s the lowest price available... Read more
21-inch 1.4GHz iMac on sale for $979, save $1...
B&H Photo has the new 21″ 1.4GHz iMac on sale for $979.99 including free shipping plus NY sales tax only. Their price is $120 off MSRP. B&H will also include free copies of Parallels Desktop... Read more
13-inch 1.4GHz/256GB MacBook Air on sale for...
B&H Photo has lowered their price on the 13″ 1.4GHz/256GB MacBook Air to $1059.99 including free shipping plus NY sales tax only. Their price is $140 off MSRP, and it’s the lowest price for this... Read more
Save up to $400 with Apple refurbished 2014 1...
The Apple Store has restocked Apple Certified Refurbished 2014 15″ Retina MacBook Pros for up to $400 off the cost of new models. An Apple one-year warranty is included with each model, and shipping... Read more
New 13-inch 1.4GHz MacBook Air on sale for $8...
 Adorama has the 2014 13″ 1.4GHz/128GB MacBook Air on sale for $899.99 including free shipping plus NY & NJ tax only. Their price is $100 off MSRP. B&H Photo has the 13″ 1.4GHz/128GB MacBook... Read more
Apple Expected to Reverse Nine-Month Tablet S...
Apple and Samsung combined accounted for 62 percent of the nearly 36 million branded tablets shipped in 3Q 2014, according to early vendor shipment share estimates from market intelligence firm ABI... Read more
Stratos: 30 Percent of US Smartphone Owners t...
Stratos, Inc., creator of the Bluetooth Connected Card Platform, has announced results from its 2014 Holiday Mobile Payments Survey. The consumer survey found that nearly one out of three (30 percent... Read more

Jobs Board

*Apple* Solutions Consultant (ASC) - Apple (...
**Job Summary** The ASC is an Apple employee who serves as an Apple brand ambassador and influencer in a Reseller's store. The ASC's role is to grow Apple Read more
*Apple* Solutions Consultant (ASC)- Retail S...
**Job Summary** The ASC is an Apple employee who serves as an Apple brand ambassador and influencer in a Reseller's store. The ASC's role is to grow Apple Read more
Project Manager, *Apple* Financial Services...
**Job Summary** Apple Financial Services (AFS) offers consumers, businesses and educational institutions ways to finance Apple purchases. We work with national and Read more
*Apple* Store Leader Program - College Gradu...
Job Description: Job Summary As an Apple Store Leader Program agent, you can continue your education as you major in the art of leadership at the Apple Store. You'll Read more
*Apple* Retail - Multiple Positions (US) - A...
Sales Specialist - Retail Customer Service and Sales Transform Apple Store visitors into loyal Apple customers. When customers enter the store, you're also the Read more
All contents are Copyright 1984-2011 by Xplain Corporation. All rights reserved. Theme designed by Icreon.