Apple Urged to Manufacture iPhone & Other Products In America
Gloven RamosAn interview with President-elect Donald Trump held a month ago showed that his campaign is focused in restoring thousands of manufacturing jobs to the U.S. Then he said to the CEO of Apple, Tim Cook, that he wants to get Apple to manufacture its products in America.
Trump offers a deal with the Apple CEO if they will manufacture iPhones and other Apple products in America instead of other countries. Trump also even offered a large tax cut for the corporations who will follow his advice.
In the New York Times report, Trump revealed that Apple CEO Tim Cook called him. "I got a call from Tim Cook at Apple, and I said, 'Tim, you know one of the things that will be a real achievement for me is when I get Apple to build a big plant in the United States, or many big plants in the United States," he told a room full of reporters. Cook's reply was a mere "I understand."
Apple did not immediately respond to the deal, but there are reports that they began exploring the possibilities of moving their production in the United States prior to Trump's election victory. Apple must know first how a big change like this could affect the company.
According to Forbes, Apple should consider the proposal of Donald Trump. However, this consideration could lead to a conclusion that manufacturing of Apple's products in America would make a big increase in their costs.
The site also cited that the Apple can make an iPhone 7 32GB for $400 and selling it for $649, making a gross margin of 38.4 percent. But based on the studies, back in 2010, Apple made 68 percent gross margin, which is higher than the current result.
Given the complexity of Apple's supply chain, to estimate how manufacturing in the U.S. would affect the prices and cost is very difficult. But an analysis regarding this matter results an increase of a mere $30 to $40 to cost when it will make in the U.S.
The decision whether Apple will accept the offer to manufacture iPhones in the US is depend on Tim Cook. Also, as a business matter, the company may more likely to choose where they will benefit the most.
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