Manufacturing Apple Products in the US

The WSJ had a short article the other day regarding Apple manufacturing parts for their products in the US. Truth is Apple makes quite a bit for their products in the states, including the processors and the glass that covers the front of all of their iOS devices. (and the back of the iPhone) They point out that one of the biggest problems with manufacturing their products in the US is that their just aren't enough manufacturing engineers.

I don't totally buy this as a reason, and I don't necessarily think Apple believes it either. They don't need an army of engineers to help them manufacture their products here, just a handful. They're Apple, they could find the best engineers in the country, and many of them would come out of the woodworks to be a part of that.

The bigger issue is that the assembly of their products is just incredibly labor intensive. Their finally assembly for the iPhone has somewhere in the range of 100+ screws. Those don't get inserted by machine. And believe me, you cannot pay American wages for that kind of manual assembly, for 30-40 million devices a quarter.

But sub assemblies on the other hand, this is where American can knock it out of the park. In addition to the processors, American companies could be making the flash memory, the circuit boards, the circuit board assembly, all of these various sub assemblies that are heavily automated. I know Apple is proud to be an American company. The late Steve Jobs even said so during their "Antennagate" press conference. I think it's very likely that Apple is looking to find ways to produce more of their sub assemblies here. I hope they look at WAi for help! (I'm not holding my breath)

Why we left our factories in China

Why we left our factories in China Here's a feel good story for your weekend. Sleek Audio, maker of customizable earphones, recently moved most of their manufacturing back to the United States from China. I like the phrase they use "reshoring". Fortune has the article so click the link to learn more.

I'm seeing more and more of this. OEM's are getting fed up with the hassles of dealing with a factory many many miles away. Even with the flattening of the world, it's still difficult for a relatively small company to manage their manufacturing operation when they are so far away. And even then, who are you dealing with at your contract manufacturer. Probably the fabled "account manager", who speaks the English language, but doesn't communicate all that well, and can't even get you answers because the rest of the group won't be in until 2AM your time. Give me a break!

We need next generation manufacturers. Companies that will step up and compete and offer you real service. When you call Worthington Assembly, you get Neil Scanlon, the company's president. Something tells me your "account manager" won't be able to help you quite as well.

We've Become a Nation of Takers, Not Makers

We've Become a Nation of Takers, Not Makers Great piece by Stephen Moore of The Wall Street Journal. He brings up some amazing statistics about the number of people working for the United States government compared to manufacturing workers. In fact he even goes so far as to show that there are more people working for the government than work for manufacturing, fishing, mining, farming, utilities, forestry and construction... combined!

Here's a choice quote

When 23-year-olds aren't willing to take career risks, we have a real problem on our hands. Sadly, we could end up with a generation of Americans who want to work at the Department of Motor Vehicles.


Is a return to 'Made in the USA' Possible?

Is a return to 'Made in the USA' Possible? Eric has some interesting thoughts here. He lays out the challenges that could get in the way of American manufacturing becoming prolific again. He misses a couple points but this one stood out the most for me.

Electronics component supply base: Houston, we have a problem...

Oh yeah. We have a problem. He points out that China controls 80% of the supply chain. That's why often times it may seem so much less expensive to manufacture in China, because they have all of the parts. But we're finding that there are much higher costs to OEM's that never get weighed evenly. Risk!