How and Where iPhone Is Made: A Surprising Report on How Much of Apple's Top Product is US-manufactured
Are the last chapters of the iPhone saga unfolding? Not by any stretch of imagination, if you ask the Apple faithful. Definitely starting, if you ask the Android challengers.
The world and word war between Android and Apple just keeps escalating to ever greater heights, and has been the most engrossing story in business for quite a number of quarters now. Let’s not even talk courtroom battles and intellectual property clashes here. Very few technologies are completely new. Most owe a debt of gratitude to forebears who laid the foundation for all the awesomeness we carry around in our bags and pockets. Let’s just talk about sales.
The release of iPhone 6 last September 2014 put the focus once more on the Apple supply chain. I pointed out in a recent article tiny “cracks” in the Apple’s Chinese supply chain, notably the introduction of robotics to cut production costs. Will these machines displace Chinese workers in the future, too?
Clearly, Apple has never been as popular as it was in the 2nd quarter of 2013. In the Q3 earnings call, Apple reported that 31.2 million iPhones were sold in that quarter. In fact, 34 million units of iPhone 5 were sold in the first 100 days. This was a quarterly record for Apple. Contrast this with 26 million iPhones sold last year. The company’s flagship product still has firm believers worldwide. That’s not the whole story, however, because incredible as it may seem iPhone 5 sales figures in the last three quarters were lower than what Wall Street expected causing massive fluctuations in the value of Apple’s shares in the stock market.
From the left flank, it looks like the Android charge led by Samsung is gaining ground. In 2012, Apple lost its firm grip on the smartphone market and Android manufacturers were emboldened to match Apple’s products spec for spec and price point for price point. Apple still leads, but not by miles. By the end of July 2013, Android phones have 65% of all smartphone sales in the nine influential smartphone markets in the world (UK, Germany, France, Italy, Spain, USA, Australia, China, Mexico), although as a single model, iPhone still has the biggest slice of the pie – 26.3%.
In the aftermath of Apple’s double whammy release of the premium iPhone 5s and the more price-friendly iPhone 5c, the excitement over has skyrocketed to even greater heights. What fortune awaits the radical plastic-enclosed iPhone 5c? Is Apple running scared or is it just plain smart? Two can play the game, after all. If Android manufacturers are leveling up to Apple’s premium space, why can’t Apple level down to Android’s budget territory? It turns out that the iPhone 5c is not so cheaply priced, after all. It’s still a premium device targeted solidly at the mini versions of the flagship devices of Android rivals Samsung, HTC and Sony.
Fact is, Apple gets even more aggressive than usual. Weeks before the new iPhones were officially released, it implemented a trade-in program that will take hundreds of dollars off the price of the new handset if the customer turns in an older model in perfect working condition.
With sales of 9 million smartphones (combined for the 5s and 5c) reported on just the opening weekend, it looks like Apple has another winner in its hands and safely through with flying colors for the next four quarters, at the very least.
In this infographic we trace the iPhone supply and manufacturing chain. We’re providing snippets of information on just who is making the parts that go into the two new iPhones, and where, exactly, these parts are made. Did you know, that the much-touted fingerprint sensor was imagined in Florida, but manufactured in Asia by Taiwanese giant TMSC? How about the M7 motion co-processor? Did you know that it’s the brainchild of NXP, a company in the Netherlands, which has fabrication facilities in Taiwan, Thailand, Malaysia, Singapore and the Philippines?
Still, reports are coming in that US companies involved in the Apple supply chain are beefing up their US production facilities and many of the components that go into the iPhone are actually made Stateside and shipped to China for assembly.
What does the rest of the world contribute to the making of the iPhone? Let’s find out!
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