Apple possibly moving some production out of China

Apple possibly moving some production out of China


FIRST REMEMBER THE HONG KONG DISTURBANCES ARE WITH WE’RE GOING ON TRADE. SPEAKING OF WHICH CHINA IS FACING LONG-TERM EFFECTS EVEN IF A TRADE DEAL IS SCORED. WE’RE GETTING REPORTS THAT APPLE IS SERIOUSLY EXPLORING A POSSIBILITY, MAKING GOOD CHUNK OF ITS PHONES MAYBE UP TO A THIRD, OUT OF CHINA UP TO OTHER LOCALES. NO MATTER WHAT HAPPENS ON THE TRADE FRONT. WE HAVE STANFORD BUSINESS SCHOOL LECTURER DAVE DOTSON ON THAT. PROFESSOR THIS, FOLLOWS OTHER COMPANIES CONSIDERING THE EXACT SAME THING. WHAT DO YOU MAKE OF IT?>>WELL, I THINK IF APPLE MOVES 1/3 OF THEIR JOBS, A THIRD OF CHINESE JOBS OUT OF CHINA AND MANUFACTURES THEM IN VIETNAM AND INDIA, TO CHINA WILL BE ONE BIG, WHO CARES. HERE IS THE THING, NEIL. CHINA WILL LIKELY TRADE A FEW LOW SKILLED MANUFACTURING JOBS FOR APPLE’S PHONES IN RETURN FOR WINNING SMARTPHONE MARKET IN ASIA. APPLE EMPLOYS 3 MILLION PEOPLE DIRECTLY OR INDIRECTLY IN CHINA. THAT SOUNDS LIKE A LOT. IF THE WORKFORCE IS 776 MILLION PEOPLE. IF HALF A MILLION JOBS MOVE OFFSHORE AWAY FROM CHINA, THAT IS NOTHING FOR CHINA TERMS OF THEIR WORKFORCE POPULATION. SORRY ABOUT THAT. BUT WHAT IS INTERESTING IS THIS, DURING THIS WHOLE TIME HUAWEI IS WINNING THE SMARTPHONE MARKET IN CHINA. THEY HAVE NOW UNSEATED APPLE AS NUMBER TWO PROVIDER OF SMARTPHONES IN CHINA. THAT’S THE BIG NEWS. THAT IS A STRUCTURAL CHANGE IS NOT LIKELY TO CHANGE. WHY CHINA IS CERTAINLY WILLING TO TRADE A FEW LOW SKILLED MANUFACTURING JOBS TO WIN THE SMARTPHONE MARKET IN ASIA. THEY WILL WIN IT FOR A LONG TIME AND HERE’S WHY. FIRST OF ALL, AS A RESULT OF THE TRADE WAR, NATIONALISTIC TENDENCIES IN CHINA, ESPECIALLY THE WAY THE UNITED STATES TALKED ABOUT HUAWEI, THE SHIFT FROM APPLE OR ANDROID PHONES TO HUAWEI PHONES IS SEMIPERMANENT. PEOPLE DON’T GO BACK AND FORTH BETWEEN PHONES THEY USE. HERE IS THE SECOND THING, THE THING POTENTIALLY A HOME RUN FOR HUAWEI AND WHAT WILL HER APPLE IN THE LONG RUN, HUAWEI WILL DEVELOP THEIR OWN OPERATING SYSTEM. ONCE THEY HAVE THEIR OWN OPERATING SYSTEM, THEY DON’T NEED GOOGLE. THAT IS THE PRICE WE’LL PAY IN THE LONG RUN. NEIL: I WONDER IF OTHER COMPANIES FOLLOW WHAT APPLE IS DOING? MANY COMPANIES PREDATE APPLE. THEY HAVE MOVED LOCATIONS TO CHEAPER LOCALES, TAIWAN, ONE DISTRIBUTOR MOVED TO MEXICO JUST AS THOSE TARIFFS WERE BEING MENTIONED, LEAVING THAT ASIDE, THEY DON’T WANT WHAT IS DRIP, DRIP, TO TURN INTO A FLOOD EXODUS, DO THEY?>>NO OF COURSE. THESE ARE UNINTENDED CONSEQUENCES AFTER LONG-TERM TRADE WAR. WE WERE HOPING FOR ARE A SHORT-TERM TRADE WAR, WE COULD TWEAK SOME TARIFFS AT CHINA. THEY WOULD COME TO THE TABLE, WE WOULD MAKE CHANGES IT WOULD BE FINE. WHAT IS HAPPENING WE’RE SEEING THROUGHOUT THE WHOLE GLOBE TRADING PATTERNS CHANGING. NOT JUST IN APPLE iPHONES. IT IS IN SOYBEAN MARKETS. ACROSS HOW OUR AUTOMOBILE MANUFACTURERS ARE SUPPLYING THEIR STEEL AND ALUMINUM. WE’RE SEEING A WHOLE RESET IN GLOBAL SUPPLY CHAINS. GLOBAL SUPPLY CHAINS ARE LIKE INTRICATE NEURAL NETWORKS. IF YOU CHANGE ONE PIECE OF IT, IT RIPPLES THROUGH THE WHOLE SUPPLY CHANGE. THEY WILL TAKE YEARS TO CHANGE. THEY WILL BE PERMANENT CHANGES. THERE IS NO WAY APPLE WILL HAVE THE SAME DEPENDENCY ON ONE COUNTRY GOING FORWARD JUST LIKE CHINA IS NOT BEING DEPENDENT ON U.S. SOYBEAN PRODUCERS THE WAY THEY HAVE. NEIL: I’M GOING A LITTLE OVER TIME HERE, BUT CHINA HAS BEEN A BEACON FOR A LOT OF BUSINESSES, CHEAP LABOR. IT IS NOT AS CHEAP NOW. AS IT GROWS, BECOMES A ECONOMIC POWERHOUSE IT HAS IT IS LOSE OUT TO CHEAPER PRODUCTION RIVALS AROUND THEIR NEIGHBORHOOD. WHATEVER HAPPENS ON TRADE FRONT, DOES CHINA HAVE TO WORRY ABOUT POST-TRADE ISSUES THAT ARE BIGGER THAN TRADE, MUCH MORE THAN WE DO?>>I THINK THE PART THAT WE’RE MISS SOMETHING THAT CHINA IS MOVING FROM BEING A LOW COST SUPPLIER OF MANUFACTURING PRODUCTS TO A CONSUMER. A FINISHED PRODUCT IS REALLY, THAT IS THE PRIZE. IT IS NOT INDIVIDUAL COMPONENT. THAT IS WHY I’M SAYING CHINA WILL CERTAINLY TRADE LOW SKILLED MANUFACTURING JOBS AS A RESULT OF THIS TRADE WAR. WHAT IS REALLY GOING TO HAPPEN, WHAT WE NEED TO FOCUS ON WHAT IS GOING TO HAPPEN TO FINISHED GOODS PRODUCTS IN CHINA. I’M TALKING ABOUT THINGS LIKE HUAWEI IN TERMS OF THEIR FINISHED PRODUCT SALES TO CHINA. NEIL: DAVE DOTSON, I CANNOT IMAGINE BEING ONE OF YOUR STUDENTS.

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51 Comments

  1. Oh I see the comments aren't disabled for this video, interesting, didn't want comments on the other video but this one you allow hmm

  2. Design in USA, made in China. Copy, extort, steal in China, redesigned in China, and then made in China. Maybe that is why most things I see in WalMart, Target, and Amazon is made there.

  3. Americans who think moving their factories out of China could have a long term profit are all stupid. It will make no change for US total trade deficit towards other countries is the facts. Moreover the moving cost, management cost, training on unexperienced/unefficient workers are particular the extra overheads. technical skills transfer to more Asia countries means create more low cost competitors for US in the future. Trump is making US looking great, as future will be the battle field for the asia market players. US will no longer stayed competitive in the low cost market and can only be a great AUDIENCE 😁😁😁

  4. Manufacturers of job is getting greater right there on May in China and specially that some Americans want a jump back to manufacturer right here and made in America of a better job of a security and a better of a to B responsibility whoever they are but there is one little a bit of a problem and everyone should know this already it is right funny of your nose have you noticed that our of how that different parts and pieces that is getting faster and faster and quicker and quicker and you shouldn't suck this one coming right now but you didn't see it but I hope that you do understand that you already know or you just don't know and specially this is telling the truth the right way that of my own words because sometimes that someone said is right or wrong or something just missed of a word especially that how great job back that's the question right there

    PS I'm just a handicap I am and I speak both language and less half of a great responsibility like to share a 50/50 of Manufacturers have things are other things as well

  5. Another 'American' professor predicting ruin and doom for the US all because Trump's policy while portraying our adversaries as the better part on the conflict. He can't even give an answer to the last question, a honest answer would have sound favorable to the US. Meanwhile in the USA we have the best economy in 60 years and I don't see the prices of Chinese products going up, just go to walmart or buy something online, nothing has changed, same prices like they were last year or even the year before. That tells me that maybe the chinese are the ones paying for the tariffs not the american people as these 'experts' want us to believe.

  6. Nobody should buy Apple products anymore. No Mc Donalds food ( look the damage the food is doing to Trumps brain) , no Coca Cola, no more holidays spent in the U.S.( too dangerous) etc etc etc.
    Thats what the rest of the world should avoid in future. Let us face it. Do we need all this products of the U.S.? No we don' t. They are a danger for our health and security.

  7. Wrong analysis! One dimension view from the number. It will significantly impact on the Chinese market and economic. This will put more pressure on other foreign company to move out of China too. This is the ripple effect he should be thought of.

  8. Apple died with Steve jobs. Apple is loosing in China and India because Apple products are too expensive for Chinese and Indian middle class.

  9. Actually Mr. "Lecturer" Dave Dodson, I don't really care if Huawei creates its own operating system. And Google's already sunk itself with the shenanigans it's been playing at over the past 5 years or so. So Huawei creates some competition to Google an Apple. Who cares? That's what we want. That's when we (the people) benefit. I don't give a fukk if Apple fails. I don't care if Google disappears. Something better always comes along to knock down the competition. WE aren't going to pay a price for this – Apple will and Google will. You saying that you don't think Google and Apple can compete with Huawei? And why shouldn't China have its own businesses and products for its people while the US has its own businesses and products and Canada has theirs and France and Germany and Nigeria and every sovereign nation in the world have their own economies? I'm sick of the global corporations and their corporate imperialism. Bring back the FREE market meritocracy and competition. That's the only way the people win.

  10. About 25% of Apple's revenue comes from the China market. If Apples were to move its production out of China, then there is no reason for China to welcome Apple. The Chinese government can ban iPhones like what the American government did to Huawei.

  11. Do you know that in the middle east, Africa and India Chinese brands of smartphones have the biggest market share? In Europe and the rest of the developing countries, the sale of Chinese smartphones is growing very fast as well.

  12. I don't think apple making phones in China, paying taxes in China and taking part of the Chinese phone market has much effect on America People, or American prosperity.

  13. Analysis is in valid in an environment where the government subsidies business. What China cares about is lose of revenue. There is no such thing as permanence in business and technology. China is not trading jobs for market share. Professor obviously have a biased point of view. It’s simply not that complicated, you negotiate for the benefit of you country. In a free, capitalist market trade will flow and all can prosper.

  14. Possibly??? If Trump puts tariffs on phones, tablets, and computers Apple stock will dive to the basement. China invites companies in, takes their technology, starts a Chinese company to compete, and the original company goes bankrupt in China. Apple, look at Motorola. That is your fate…

  15. Word of the Lord in our Bible says; no weapon formed can come against you. So Trump will stand for our freedom and keep America from falling. Voting Dem's out of Office and Military Tribunals in 2020. Good By DemocRATS. YOU THINK?

  16. Loss of 2 million jobs will effect 2 million workers. PERIOD. Means 2 million MORE are driven to poverty.

  17. The guest misses the point. This is excellent for the united states. Less dependence on any one source means better everything. Second, China losing American companies means they can't steal our technology anymore. Ultimately the US will win big from this long term trade war.

  18. The nationalistic tendency in China, come on. it has always been about China, using Capitalism as a gateway to wealth. Those days are over.

  19. Apple is not moving part of its production out of China. Apple is cutting down its production due to a decrease in the demand for Apple’s products.

  20. If Huawei develop their own poperating system, good for them, that still won't make me buy a phone from a communist snake that violates free trade as an objective. They are not going to make an operating system as appealing as the west(past products), for the west either. Ever play a chinese verison of a game for example? laughable, it doesn't matter how high-tech they get even. If they are not a free people, how can they make something for a free people? can they even conceive of it? like asking an alligator to imagine how to fly like a bird … kind of.

  21. If a smart phone these days doesn't have google it is worthless. Even to try and copy you will always be 3 steps behind the race they are running. There are many other low cost device makers that use android and google so comparing against apple is a different world. It will come down to – do I buy the cheap phone with google or the slightly cheaper phone without google and likely an operating system that was rushed out the door full of bugs and glitches and oh it might be spying on me as well.

  22. Well the problem I read this morning is that Apple's moving things back to China the problem is Apple charges triple quadruple amount for its products than what they are made for so they are just trying to make more money those greedy people that they are. they need to keep the production in the United States of America

  23. Apple dsnt need china lol 😂😂 huawei is in the heart of china admit it. Its the apple who need tech from china no matter what they will never accomplsh.✌👍

  24. Apple said this long time ago, and yet Apple is still in China, thats because Apple is a sucker for $ until China absorbed all Apple's tech of whatever is left.

  25. China is hurting themselves more than the US. Europe, Japan, the free world won't want Huwawe phones, and multi nationals will worry about the CCP taking over their business in China and will move much production out of China.

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