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Apple To Invest $100 Million In US Manufacturing, But Where and With Who?

by on06 December 2012 2491 times
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Although we have not written about Apple in a while there is some news about them that just begs to be talked about and to have some of the myths about it cleared up. In today’s news there were quite a few articles about Apple coming back to the US to make products. Most of this was fluff, but it did contain some truth in it. Apple will invest $100 Million in an unnamed east coast manufacturing plant with the first installments of this investment to start in 2013. What most of the articles missed is that compared to what they dump into China and South America this is nothing.

Now, before the Apple fans go bananas we will say that Dell, HP, and many other US companies use manufacturing plants that are outside the US. This is a common practice and has been for many years; the issue here is that none of those other companies try to claim otherwise. It was Tim Cook that pulled Apple out of the US at a time when Apple was made here and only here. Sure they bought components from other companies, but the assembly and warehousing was in the US. For a long time Dell and HP did the same (and to an extent they do, but typically for their server and workstation products.)

Still back to Apple; Apple has a multi-billion dollar investment in China and they are looking to spend more over there soon. They (Apple) have also approached TSMC about making their next generation of SoCs… Ah now we see what we might have here… TSMC has talked about building a FAB in New York near where Global Foundries is building one. Originally Apple pledged $100 Million to TSMC for dedicated manufacturing capacity. TSMC is not a US company and building a FAB in New York could be complicated for them unless they had some help. Anyone want to take bets that the $100 Million being invested by Apple for “US” manufacturing is actually going to TSMC for their US plant?

So while Apple is technically investing in manufacturing in the US they could be simply giving the money to a Taiwanese company so they can build in the US. It is not the same as investing in the US of course now Apple could put a sticker on their new devices claiming they are Made in the US…It would be about as true as their many claims that they invented the tablet or the smartphone.

And speaking of Apple’s tendency to claim they are first to do this or that when they usually are following someone else’s lead; it seems that Apple is following here too. Lenovo has moved a good deal of production to the US, Samsung is expanding their manufacturing capabilities in the US as is Seagate and Global Foundries. Once again Apple is following what others have already done.

In the end Apple will use this investment as a PR move to get people back on their side (including members of the US Government) and to keep more from leaving. They can claim they have invested in the US and that certain parts of their products are now made in the US as well. It is almost a win-win for them especially considering that fact that many news outlets are reporting this as if Apple is out healing lepers. It will be interesting to see what is really going on when everything comes out in the open. For now we have some fairly good guesses where the money is going and a few interesting rumors as well (such as one claiming that Apple will make iMacs in the US now). Still, an investment is an investment, even if it is small change compared to what they are pushing outside the US.

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Last modified on 06 December 2012
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