Apple has recently been facing increased pressure to move some of its manufacturing to the United States, with reports claiming that the company was investigating cost and other factors. Now, the CEO of Pegatron, one of Apple’s manufacturing partners, has addressed the topic of U.S. manufacturing in a new interview…
According to a new report from The Economic Times of India, Apple supplier Foxconn is close to signing a deal with the Indian government to open an iPhone manufacturing plant in the country. The report claims that Apple and Foxconn have narrowed the location for the factory down to Maharashtra.
According to a new investigation performed by Amnesty International, Apple is one of several technology companies using cobalt mined by child labor in their lithium-ion batteries. The report claims that Apple, Sony, Samsung, and Microsoft are all using the cobalt mined by child labor, as are electric car makes like Volkswagen and Daimler.
2016 presidential candidate Donald Trump today held a rally at Liberty University in Virginia during which he spoke about his normal wide range of topics. This time, however, Trump brought Apple into his speech when discussing how to bring manufacturing jobs back to the United States and away from countries like China.
Bloomberg reports that Samsung has signed on to provide A9 chips to Apple for the next-generation iPhone. Apple moved to Taiwan Semiconductor Manufacturing Company (TSMC) in 2013 for its processors, looking to reduce its reliance on Samsung, who is a major competitor in the smartphone space and a legal foe. With that said, it was reported last September that Samsung was still supplying 40 percent of the A8 chips found in the iPhone 6 despite Apple’s attempt to part ways.
Following a petition with thousands of signatures related to GPU complaints and a class-action lawsuit filed in the United States, another class-action lawsuit has been filed north of the border against Apple Canada over the same GPU issues affecting some 15-inch and 17-inch 2011 MacBook Pro models equipped with an AMD graphics chip.
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Tim Cook speaking at a conference in China
Apple is seeking to cement its business position in China for the long-term with an expansion of its Cupertino-based Apple University program to the region, according to a person with knowledge of the plans. Apple Vice President and Dean of Apple University Joel Podolny is currently interviewing candidates for a new Dean of Apple University position for China, according to the source.
Started in 2008, Apple University is an extensive and growing program within corporate Apple that trains mid-level employees and managers on the decisions made by Steve Jobs and other key executives throughout the company’s resurgence. Jobs created the program alongside former Yale School of Business Dean Podolny in order to keep the culture of Apple alive well beyond the lifetime of executives key to Apple’s early success.
The expansion of Apple University to China will mark a key step in Apple’s history as a global company. It will be the first time Apple has fully expanded the exclusive program to another region, indicating that it wants to extend its presence in China beyond mostly just sales and operations, like it has done in the United States. Apple has previously offered a minimal amount of courses in other regions and has flown-in professors. With many Apple suppliers headquartered in China, it is likely that a notable portion of the Apple University classes in China will be geared toward product engineering and manufacturing matters…
Apple is attempting to open its own stores in India, as reported by the Business Standard. However, India has regulations that require companies to source 30% of its components from Indian companies. Apple is requesting that this restriction be relaxed so that it can set up stores legally…
Back in November, the State of Arizona announced that Apple had chosen the city of Mesa to create a new manufacturing facility and in the process 700 new permanent manufacturing jobs. Some had speculated it could be part of CEO Tim Cook’s plan to bring manufacturing of Macs back to the US (Cook previously stated some parts will come from Arizona), but a supplier later revealed it would be providing equipment for the production of sapphire material at Apple’s new plant. Apple never confirmed what the plant would actually be used for, but we’ve discovered through a new job listing that Apple will indeed use the facility for manufacturing iPhone and iPod components.
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Bloomberg claims to have some info on how Apple plans to spend some of the $10.5B it has set aside for capital expenditure over the next year, saying that the investments will span everything from lasers to robots.
Apple is spending more on the machines that do the behind-the-scenes work of mass producing iPhones, iPads and other gadgets. That includes equipment to polish the new iPhone 5c’s colorful plastic, laser and milling machines to carve the MacBook’s aluminum body, and testing gear for the iPhone and iPad camera lens …
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The State of Arizona today announced that Apple is planning to build a new manufacturing facility in the city of Mesa, Arizona. The facility will create 700 jobs for manufacturing, and an additional 1,300 jobs for the construction and management of the new facility, In total, Apple will be bringing at least 2,000 new jobs to the United States thanks to this new facility.
In addition to the manufacturing facility, Apple will be constructing a new solar power grid in the city to power the manufacturing operations, according to Arizona’s announcement:
<a href="http://www.ifixit.com/Teardown/iPhone+5s+Teardown/17383">Image via iFixit</a>
Apple has confirmed to The New York Times that a “very limited” number of iPhone 5s units could experience shortened battery life as the result of a manufacturing problem.
“We recently discovered a manufacturing issue affecting a very limited number of iPhone 5S devices that could cause the battery to take longer to charge or result in reduced battery life,” said Teresa Brewer, an Apple spokeswoman. “We are reaching out to customers with affected phones and will provide them with a replacement phone.”
The exact number of affected units is not clear, but the statement is said to imply that the number is in the few thousands range. Apple sold 9 million iPhones total over its opening weekend. The NYT notes that a manufacturing problem does not equal a defective battery, so it is unclear what the actual source of the issue is.
Affected users can expect to be contacted by Apple soon and will be issued a replacement phone.
Brian White, Topeka Capital’s Apple analyst that previously gave some quite out there predictions for an Apple TV with “iRing”, today is saying that his recent checks with suppliers in Asia indicate Apple will include fingerprint sensor tech in the next iPhone. For what it’s worth, White says it could be the flagship feature of the 5S like Siri was with iPhone 4S. That’s something we predicted earlier in our “S” iPhone piece (via BusinessInsider):
White says, “we believe fingerprint identification technology will be part of the iPhone 5S and this is likely to be the major new feature used to market the iPhone 5S, similar to what Siri was to the iPhone 4S.”
I know… It’s a rumor that we’ve heard many times before, but now another analyst that often has accurate information is saying that same fingerprint tech could be the source of delays for the next-gen iPhone.
KGI Securities analyst Ming-Chi Kuo has changed his previous predictions regarding product launches for iPhone, iPad, iPod citing a number of challenges with suppliers and the development of new features including the implementation of fingerprint technology in iPhone (via MacRumors):
Earlier we estimated that shipments of the new iPhone would begin in July (FDD version) and September (TDD version), while iPad mini 2 would hit the market in August. Currently, market consensus for shipments of iPhone 5S, low-cost iPhone and iPad mini 2 is July, July, and August, respectively. But in light of publicly available information and our knowledge of technological trends, we now think all three products will begin shipments later than our previous expectation and market consensus.
While Kuo, who previously laid out his roadmap for 2013, doesn’t provide new estimates for when the devices might ship, he does say that apple is facing challenges with finding the right color coatings that work with the fingerprint sensor rumored to be included in the next iPhone, and “technical challenges” related to the manufacturing of a Retina display for a second generation iPad mini. Needlessly to say we’ll be checking back in this summer to see how accurate these analysts reports have been.
With all of the controversy and media attention Apple has experienced since The New York Times’ “How the U.S. Lost Out on iPhone Work” article, a post from Motherboard (via iFixit) provides yet another reason why Apple makes its products in China—rare earths. While noting China’s cheap labor and lack of environmental regulations certainly contribute to Apple’s decision, the post explained how Apple’s use of rare earth elements might make it hard to move manufacturing elsewhere:
But there’s another important reason why Apple and other manufacturers have their heels stuck in Chinese mud. iPad manufacturing, like the manufacturing of other electronics, requires a significant amount of rare earth elements, the 17 difficult-to-mine elements used in all kinds of green technology. It’s hard to say exactly what rare earths are in an iPad, since Apple is really tight-lipped about their materials
iFixit ‘s Elizabeth Chamberlain spoke with Cambridge engineering professor Dr. Tim Coombs who “guesses that there may be lanthanum in the iPad’s lithium-ion polymer battery, as well as ‘a range of rare earths to produce the different colours’ in the display.” He also thinks the magnets in Smart Covers and the iPad itself contain neodymium alloy. So how does rare earths keep Apple tied to China? The report explained:
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The NY Times just published an absolutely fascinating piece on Apple and why it builds almost all of its stuff in China. Go read it. Clearly some of our politicians could learn a lot from it.
The short of it is that companies like Apple simply cannot manufacture products in the United States. The cost (though it is cheaper in China) is not the reason, however. Years ago, the Chinese government subsidized building cities of factories that can hire 3,000 workers to live in a dorm per day —or 8,700 Industrial Engineers in two weeks (it would take 9 months to do this in the U.S.). Today’s gadgets require thousands of little parts that are all made in the same areas. This whole global supply chain cannot be moved to the U.S.
The most interesting tale might have been the last minute decision to make the iPhone’s display glass:
In 2007, a little over a month before the iPhone was scheduled to appear in stores, Mr. Jobs beckoned a handful of lieutenants into an office. For weeks, he had been carrying a prototype of the device in his pocket.
Mr. Jobs angrily held up his iPhone, angling it so everyone could see the dozens of tiny scratches marring its plastic screen, according to someone who attended the meeting. He then pulled his keys from his jeans.
People will carry this phone in their pocket, he said. People also carry their keys in their pocket. “I won’t sell a product that gets scratched,” he said tensely. The only solution was using unscratchable glass instead. “I want a glass screen, and I want it perfect in six weeks.”
After one executive left that meeting, he booked a flight to Shenzhen, China. If Mr. Jobs wanted perfect, there was nowhere else to go.
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.
For over two years, the company had been working on a project — code-named Purple 2 — that presented the same questions at every turn: how do you completely reimagine the cellphone? And how do you design it at the highest quality — with an unscratchable screen, for instance — while also ensuring that millions can be manufactured quickly and inexpensively enough to earn a significant profit?
Other notable tidbits:
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Hot on the heels of reports that claim Apple is gearing up to launch a new iPad model this fall, Digitimes reports that Apple will be adding a second manufacture to augment the tablet’s current manufacturing from Foxconn. Foxconn is currently Apple’s exclusive contractor for iPad 2 production and since the plant’s devastating incident in May and with a new tablet right around the corner, Apple is looking for a second manufacture to build their popular tablets.
According to the report, Apple’s second iPad manufacture will either be Pegatron or Quanta Computers. Pegatron, notably manufactures the Verizon iPhone and reportedly landed 15 million iPhone 5 orders for a fall release. Quanta manufactures some Macs and other Apple products. With Apple reportedly gearing up to launch a new iPad 2 model – dubbed iPad HD by This is my next – now is a perfect time for Apple to use more manufacturing power.
The ‘iPad HD’ is expected to be a professional-minded tablet from Apple with a 2048 x 1536 Retina Display. Artwork of this high resolution has already appeared in iOS 5 exclusive SDKframework files and has been a long-rumored feature for the tablet family. This new iPad is pegged at being another iPad model, not the iPad 3.
Besides the extremely unfortunate loss of life, Bloomberg posts a dire scenario on iPad production laid out by IHS iSuppli this evening:
The drop in manufacturing will depend on how long the plant is closed following a May 20 explosion that killed three people and injured at least 15, according to ISuppli. The total could be even greater if the suspension of operations at the facility lasts longer than a month, the firm said.
Another Foxconn factory in Shenzhen that produces iPads may not be able to make up for the lost output, ISuppli said. The manufacturing breakdown may lead Apple to miss ISuppli’s forecast of 7.4 million iPad 2 shipments in the quarter ending in June, the El Segundo, California-based research firm said.
Not all analysts are as down with Apple Bull Shaw Wu saying there may not be cause to worry. He said in a report today that the concerns are “overdone” and that production at other facilities is being ramped up to make up for the shortfalls. He expects Apple to sell 6.8 million iPads in the June quarter.
