Let's Play A Game

| September 12, 2018
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Question: How much would an iPhone cost if it all compenents were produced in the US and assembled here as well?

Answer: ~$2,000 {This estimate includes the massive specialized technology supply chain movement. labor, parts, etc.}

Yes that is more than twice the current cost.

From Jefferson Graham writing in the USA Today:

Would you willingly spend $2,000 to buy an iPhone that today costs a grand? That’s how much veteran analyst Tim Bajarin tells me it would cost Apple to retail if it made iPhones in the United States.

Why shouldn’t Apple makes iPhones here? Well, here’s the problem. It’s not just money. Yes, there’s way lower labor costs involved. Skilled workers in China make about $100 a week, way less than we offer. There’s also the availability of parts in Asia and the lack of suitable manufacturing facilities here.

Think about the parts dilemma for a second. Remember that Apple makes more than 200 million iPhones yearly and has to come up with OLED screens, camera sensors, solid state storage drives and the like to put into every one of them.

These are all made-in-Asia products. “We lost manufacturing to Asia, Southeast Asia, India and Mexico two to three decades ago, and it’s never coming back,” Bajarin told me recently. Apple’s not alone. Cameras have been made in Asia for decades, Samsung creates its Galaxy phones in South Korea, Vietnam and India, Amazon gets Echo speakers made in China and Google gets the Pixel phone made in South Korea.


Stay Tuned, Disciplined & Patient! {TJM}

The Investor & Character Equation (ICE) | S + R = O


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