Apple CEO Tim Cook has responded to questions about moving production away from China by saying that he expects the company's global production to continue on its current trajectory, but also that it is investing to increase U.S. manufacturing.
Asked by analysts in its financial earnings call to comment on President Trump's refusal to grant Apple an exclusion from tariffs in its manufacturing, Cook spoke about the company's view of the U.S./China relationship and his opinion about whether Apple will move production to new countries. Specifically, the chief executive said Apple is looking for ways to continue building — more accurately assembling — its Mac Pro desktop domestically.
"In terms of the exclusions, we've been making the Mac Pro in the U.S. and we want to continue to do that," he said, "so we're working and investing currently in capacity to do so, because we want to continue to be here."
The current Mac Pro is assembled in a factory in Austin, Tex., with parts sourced from around the world. For the incoming 2019 Mac Pro, however, Apple has handed off manufacturing duties to Quanta in China.
Cook's comments shed new light on Apple's tariff exclusion request, which involved parts associated with the new pro-level computer. It can be speculated that Apple was, and still is, seeking economical alternatives to assemble the Mac Pro in America, with those efforts stymied by the ongoing trade war.
On a broader level, Cook said to disregard rumors of a major shift in Apple's outsourcing strategy.
"There's been a lot of speculation around the topic of different moves," he said, "but I wouldn't put a lot of stock in that if I were you. The way that I view this is that the vast majority of our products are kind of made everywhere. There's a significant level of content from the United States, and a lot from Japan to Korea to China, and the European Union also contributes a fair amount. That's the nature of a global business and I think that largely that will carry the day, and in the future as well."
Cook's comments follow recent reports of Apple looking to move some proportion of manufacturing assembly out of mainland China, and that such a move would take several years.
20 Comments
No need to get worked up, or the read too much into other people's rumors or Cook's statement. For assembly and final configuration, Austin makes a lot of sense. More so since the unit volumes are low and the option combinations are numerous. These decisions can be revisited in the future, and the specific labor can be divided in many ways.
I'd bet a lot of the Mac Pro consumers are in the US, who will appreciate faster shipping times for custom configurations.
And the assembly labor of the Mac Pro is tiny compared to Apple's total cost structure.
Would be delighted if Apple moved far more production to the US, even if it meant a drastic increase in the use of robot assembly.
I, for one, welcome our new inventory management overlords.