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Question on the 50,000 jobs: is it possible to move production of the iPhone in Russia?

The iPhone going into China and it is considered that for this reason Apple saves a lot of money. But is it? What will change if the American computer electronics giant decides to move production to, for example, in one of the countries of Europe or Russia?

From home Apple is regularly criticized for the fact that it produces “the most American product in China. More recently, Steve jobs had to answer an inconvenient question to Barack Obama, then presidential candidate Donald trump said that if he will take a seat in the White House, will force Apple to collect it the damn computers in this country.” But can the company to move production from China — at least in the US, at least in Russia? And would it make economic sense?

Assembly is not manufacturing?

The iPhone is now going on seven factories, six of which are in China and one in Brazil. Actually, when I say “make” or “produce”, we mean just “assembled from spare parts as a designer.

According to IHS, the components of the iPhone 6s Plus price in USA is about $ 750, cost only USD 230. IPhone SE and the components are only 156 dollars, while the selling price in the U.S. is $ 399.

The Assembly of the gadgets, i.e. the iPhone production, according to the IHS analysis, only costs $ 4. Well, if you take a more daring assessment of 10 dollars. This figure refers to Jason Dedrick, Professor, school of information studies Syracuse University, USA. In his opinion, the transfer of production iPhone in the US would make the Assembly more expensive 30-40 dollars, not so much due to more expensive labor, how much due to changes in logistics in the delivery of components. We know that workers on the iPhone Assembly in China get about the same amount, on average, the people of Russia in “working” positions. This means that the transfer of production to Russia has increased the cost of the iPhone would be $ 30, tops.

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Bonuses for Russia in the event of such transfer — hypothetically — would be fantastic. Although Apple says that only factories of its partners employed 1.6 million people and in the Assembly, in fact, the iPhone meets the “tiny fraction” of that number, but “tiny” is relative. At one particular factory on the Assembly of the iPhone employs 50 000 people.

This number of new jobs for Russia looks promising. Could our country to find so many new workers, a separate issue — and this is one reason why Apple keeps all production in China. There, as already Barca Obama explained to Steve jobs, there is a culture of electronics manufacturing, many plants and a huge number of skilled labor.

But Apple has no economic sense to transfer the Assembly of smartphones anywhere — even in the US, the want of local politics. In fact, the US authorities also have a specific reason to insist on such migration — the economic effect is not so great as it seems from afar.

Is it possible to organize production of “components” in Russia?

Only Apple has 766 providers that are somehow involved in the creation of all its products. 346 of them work in China, 126 in Japan, 69 in the United States, 41 in Taiwan, and the rest scattered around the world. There are some in almost all the countries of Western Europe (except Spain and Portugal), as well as in Russia. In our country Apple buys precious, rare and nonferrous metals for their mobile devices and computers.

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California giant partnered with at least 11 Russian factories-suppliers. Gold, which is used to cover the contacts in the devices, Apple sell eight of them. In particular, the Novosibirsk refining plant, Ekaterinburg factory on processing of nonferrous metals, OAO “Uralelectromed” of Upper Pyshma Sverdlovsk region, Moscow plant for machining special alloys and others. Stavropol factory “single crystal” supplies for Apple sapphire glass that is used in iPhone and Apple Watch.

Thus, we just destroyed two myths: that iPhone is done entirely in China, and that production of a single smartphone can be establish in a single country, even as big as China.

More precisely, if you look at the specific of the iPhone, purely theoretically, the factories producing them can be placed in almost every single country in the world. Simply because technology is changing so rapidly that equipment should be changed or seriously upgrade every few years. What difference where to take the “tools” to China or Russia? And the cost of labor which will to work on it, in comparison with the price of the technology is negligible.

However, there is the factor of “brain drain” — many of the iPhone invented and produced in China and no desire to move to China or any other country their creators do not show. As they say, where was born — there and handy.

In addition, as we said above, in recognition of Apple, enterprises 766 its partners employs 1.6 million people — in Russia it will be difficult to find so many workers.

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If we consider the possibility of “forced” relocation of production all suppliers and partners of Apple in any large country, for example, the United States, according to researchers from Syracuse University, this would increase the cost of the iPhone by about $ 100 — from 230 to 330 dollars.

Hundred dollars, that is the “discount on globalization and the reason of the centralized production of complex things in one country, be it Russia or China, it is necessary to forget forever.

according to the materials of the

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