Free Republic
Browse · Search
News/Activism
Topics · Post Article

Skip to comments.

Apple's earnings would drop by nearly 30% if China bans its products, Goldman Sachs says
CNBC ^ | Fred Imbert

Posted on 05/23/2019 4:19:17 AM PDT by Zhang Fei

click here to read article


Navigation: use the links below to view more comments.
first previous 1-2021-26 last
To: Zhang Fei

I’m an Apple guy, but perhaps this would help them to get off their lazy butts and start devoting some engineering talent to producing some new products instead of giving us more of the same.


21 posted on 05/23/2019 5:38:08 AM PDT by Da Coyote
[ Post Reply | Private Reply | To 1 | View Replies]

To: Lockbox; Zhang Fei

“where can Apple move production next week to continue production?”

All the big companies were given the head’s up warning at the beginning of 2017. President Trump started rotating groups of corporate leaders through the White House for meetings, starting his very first week in office.

Apple has long used its supplier Wistron to manufacture produucts in Bengaluru (India), mostly older models for its local market.

Apple’s main supplier in China for its newer models destined for export to the USA, Foxconn, already is establishing new facilities in Sriperumbudur, Tamil Nadu State, to manufacture the latest models, to start this year. It is actually a major expansion of Foxconn’s pre-existing facility there (~25,000 jobs), rather than a whole new start. It is well beyond planning, and they were spending real money on it last year.

Taiwan-based Foxconn has facilities all over (even building now in Wisconsin). Other facilities, in other countries, might also be expanding as part of its preparations. But as a world leader in electronics production and assembly, whose CEO’s expressed top priority for about the last two years has been planning to move production out of China (he words it more tactfully), we can be confident that Foxconn has plans to support their customers, through a transition they were warned about 2 1/2 years ago.

Apple is still likely to take a hit on its loss of sales in the Chinese domestic market, but as investment is made in facilities to produce newer models, it is significantly being invested outside of China. Overall Foreign Direct Investment in manufacturing in China had already been declining before President Trump came into office, but it has really dried up since.


22 posted on 05/23/2019 5:43:06 AM PDT by BeauBo
[ Post Reply | Private Reply | To 8 | View Replies]

To: BeauBo
The iPhone's Assemblers companies are Foxconn and Pegatron, both of which are based in Taiwan.

Foxconn currently assembles the majority of Apple's iPhones in its Shenzen, China, location, although Foxconn maintains factories in countries across the world, including Thailand, Malaysia, the Czech Republic, South Korea, Singapore, and the Philippines.

The question is how long to move or duplicate the special tooling, increase production lines in other factories, relocate the parts, hire and train new workers and get up to speed to replace the lost production from China. This would take months not weeks. So Apple would lose about one quarter of iPhone production minimum. They could offset with higher production in China before leaving, but there would be higher costs for this option.

23 posted on 05/23/2019 7:20:44 AM PDT by Lockbox
[ Post Reply | Private Reply | To 22 | View Replies]

To: Spktyr
A lot of people here that shout about MAKE IT IN THE US NOW NO EXCUSES don’t realize just how decimated our tech manufacturing industry is and how long it would take to rebuild and fire it back up

The Magic Tariffs will make it all reappear overnight, you'll see! /s

I don't see any serious plan to annihilate the entrenched Leftist bureaucracy that drove manufacturing offshore in the first place. Best we can hope for is Vietnamese-made iPhones that don't directly fund the expansion of the PLA.

24 posted on 05/23/2019 7:54:55 AM PDT by Mr. Jeeves ([CTRL]-[GALT]-[DELETE])
[ Post Reply | Private Reply | To 15 | View Replies]

To: Zhang Fei

Apocalypse number 796!


25 posted on 05/23/2019 8:41:04 AM PDT by ChinaGotTheGoodsOnClinton (Go Egypt on 0bama)
[ Post Reply | Private Reply | To 1 | View Replies]

To: Lockbox

“So Apple would lose about”...

No doubt there will be disruption, expense, risk and hassle to such a move.

It takes a big lever, like President Trump’s tariffs, to get companies to make the move. He has been very (professionally) accommodating of the business realities, by giving them early enough warning, but they are going to be forced to move.

Apple is likely to take the biggest hit of any US corporation, so we will likely be treated to many news stories about their troubles, trying to make us think that is the typical experience.


26 posted on 05/23/2019 11:09:53 AM PDT by BeauBo
[ Post Reply | Private Reply | To 23 | View Replies]


Navigation: use the links below to view more comments.
first previous 1-2021-26 last

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.

Free Republic
Browse · Search
News/Activism
Topics · Post Article

FreeRepublic, LLC, PO BOX 9771, FRESNO, CA 93794
FreeRepublic.com is powered by software copyright 2000-2008 John Robinson