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This line caught my attention: "The US manufacturing of Mac Pro is made possible following a federal product exclusion Apple is receiving for certain necessary

This line caught my attention: "The US manufacturing of Mac Pro is made possible following a federal product exclusion Apple is receiving for certain necessary components." Is this sort of a "if you don't make us pay tarrifs on component X, we'll build component Y in the USA?" Also I'm happy to see Apple doing this. Even if it's 50% press fluff, I think it'll make other companies in the industry think harder about their own practices because Apple commands such a great reputation.

wyldfire 7y ago
> Is this sort of a "if you don't make us pay tarrifs on component X, we'll build component Y in the USA?" Yes, that would be my assessment. Here are the criteria used by the US Govt to grant the tariff waiver [1]: > Whether the particular product is available only from China and specifically whether the particular product and/or a comparable product is available from sources in the United States and/or third countries. > Whether the imposition of additional duties on the particular product would cause severe economic harm to the requestor or other U.S. interests. > Whether the particular product is strategically important or related to “Made in China 2025” or other Chinese industrial programs. [1] https://www.federalregister.gov/documents/2019/09/20/2019-20442/notice-of-product-exclusions-amendment-to-the-exclusion-process-and-technical-amendments-chinas-acts https://www.federalregister.gov/documents/2019/09/20/2019-20...
- baybal2 7y ago
  Thanks for pulling that link out. Just look at that exemption list. Product category description lists look to me almost exactly like rigged state tenders would look like in some post-Soviet country > LED lighting fixtures, a kind of used in horticulture, containing over 5,000 LEDs spread across 6 light bars > Grills composed of steel wire, each measuring 49cm by 47cm, weighting 0.36kg > Power supplies ... measuring 148cm in length, 43cm in width Those items are pretty much purpose written for individual benefactors
  - cl0ckt0wer 7y ago
    Wow, I had to look this up. Great band name! https://en.wikipedia.org/wiki/Chabazite https://en.wikipedia.org/wiki/Chabazite
  - _puk 7y ago
    > > LED lighting fixtures, a kind of used in horticulture, containing over 5,000 LEDs spread across 6 light bars Also, really makes one wonder if that sort of specific setup is perhaps the subject of an existing patent. Imagine being in a position whereby there can be no innovation beyond a specific exclusion on a competitive cost basis, and that exclusion being wholly owned already. Seems an alarming way to either enrich incumbents, or stifle Innovation full stop, or both.
    - lonelappde 7y ago
      This insinuation is simply false. Anyone building any product can apply for a waiver under the same general rules. The waivers only apply to the specific products that apply.
      - ken 7y ago
        Big companies like Apple can easily put many people to work applying for exemptions, while small business owners can’t afford to. The mere existence of such a system is rigged in favor of incumbents. This is the “well anyone technically could have” excuse, aka the first chapter of “The Hitchhiker’s Guide to the Galaxy”.
  - woah 7y ago
    Reminds me of the detailed but oddly vague exemptions in California’s new AB5 law
  - ajdlinux 7y ago
    And if you read the Background section, you'll see that this list is the result of a process where the USTR asked for exclusion requests, and companies had to provide the codes of the specific products they want excluded. "Under the June 24 notice, requests for exclusion had to identify the product subject to the request in terms of the physical characteristics that distinguish the product from other products within the relevant 8-digit subheading covered by the $200 billion action. Requestors also had to provide the 10-digit subheading of the HTSUS most applicable to the particular product requested for exclusion, and could submit information on the ability of U.S. Customs and Border Protection to administer the requested exclusion." So... it's not exactly a surprise if the list reads like it was compiled for the benefit of individual companies. Because... it was.
- kerkeslager 7y ago
  Wow, what an enlightening link. At first, reading that there's an exemption process, I thought that the bill was better-thought-out than I initially had thought. But then seeing the existing exemptions, I'm realizing that this stinks of lobbying. It's clear that these exemptions are targeted at specific products, and are almost certainly there because some company lobbied to bypass going through the normal exemption process.
  - sulam 7y ago
    Yes, but aren't you glad to know our government is looking out for the live bait and tackle vending machine industry?
  - rayiner 7y ago
    That’s not the bill. That’s from the federal register, which records decisions of administrative agencies. Assuming you’re talking about Annex A, that is a recording of specific products that the USTR has ruled are excluded in response to existing exclusion requests: > As set out in Annex A, the exclusions are reflected in 38 specially prepared product descriptions, which cover 46 separate exclusion requests. As is clear from Section C, these are decisions on publicly filed exclusion requests that were the subject of public notice and comment. There is in fact a whole website dedicated to explaining what these exclusion requests are and how to apply for them: https://ustr.gov/issue-areas/enforcement/section-301-investigations/section-301-china/200-billion-trade-action https://ustr.gov/issue-areas/enforcement/section-301-investi... As discussed above, criteria for exclusion are things like products that are only available from China, whether the product is strategically important to China, etc. But the decisions are made case-by-case and that’s why the list of excluded products is literally a list of specific products. This is just a funny misunderstanding, but a lot of “the government is so corrupt” type ranting is rooted in these sorts of erroneous readings of legal documents.
    - kerkeslager 7y ago
      Thanks for the correction! It seems I didn't understand what I was reading.
    - 7y ago
- jtbayly 7y ago
  So, my interpretation is not the same as yours. It does not appear that there is any consideration in this list for something along the lines suggested by the GP. Namely, I don't see "Company agrees to bring production of some other product into the US" as grounds for granting the waiver. Is there any evidence that this was a quid pro quo sort of arrangement?
  - wyldfire 7y ago
    That's the vibe I got from the Apple PR. "Yay, still made in USA. This wouldn't have been possible without the exemption we got from the govt for us to import these parts w/o high tariffs." (Simultaneously prostrating ourselves and indicating our resolve to move production if necessary) [1] https://mobile.twitter.com/realdonaldtrump/status/1154774656861257732 https://mobile.twitter.com/realdonaldtrump/status/1154774656...
    - lonelappde 7y ago
      The point is that Apple tried to build a Mac in Texas, but would have to pay a tariff on some component X. So Apple said maybe it's better to build a the whole thing in China since we're paying tariff anyway. And the administration said OK, you can import X without tariff to enable the assembly in TX. It's not Apple's that the tariff pricing structure had perverse incentives.
      - hoseja 7y ago
        Except material/component cost and Apple margins are utterly unrelated.
- darksaints 7y ago
  Regulatory capture in action right here. I'm willing to bet Apple fully supports these tariffs now that they have their waiver.
  - Angostura 7y ago
    If they had achieved waivers on iPhone components perhaps but a tiny volume, high-margin product like the Pro?
  - deleted 7y ago
    [deleted]
  - lonelappde 7y ago
    Baseless speculation. Especially silly since Apple does not compete on price at all.
Despegar 7y ago
>Is this sort of a "if you don't make us pay tarrifs on component X, we'll build component Y in the USA?" They're basically responding to these stories by WSJ and Bloomberg saying that they're moving production of the Mac Pro back to China. That was never confirmed by Apple and Tim Cook denied it when asked on an earnings call. https://www.wsj.com/articles/apple-moves-mac-pro-production-to-china-11561728769 https://www.wsj.com/articles/apple-moves-mac-pro-production-... https://www.bloomberg.com/news/articles/2019-07-23/apple-seeks-mac-pro-parts-tariff-exclusion-after-move-to-china https://www.bloomberg.com/news/articles/2019-07-23/apple-see...
helpPeople 7y ago
>other companies in the industry think harder about their own practices because Apple commands such a great reputation Great reputation to make Profit isn't the same as Great Reputation. Apple is one of the most hostile and anti competitive company in my lifetime. We should not applaud such business practices. Edit- ib4 "privacy" buzzword
- human20190310 7y ago
  It's a company's job to be anti-competitive, in the sense of vanquishing its competitors. It gets pathological in the case of regulatory capture, but I don't think Apple has managed that.
  - asjw 7y ago
    No, It isn't. The company job is doing well their core business. Mafia's job is to be anti competitive.
    - IOT_Apprentice 7y ago
      The Mafia is not a business. Apple does well in their core businesses.
      - robdachshund 7y ago
        Mafia is straight up a business buddy
  - munk-a 7y ago
    > It's a company's job to be anti-competitive No it isn't, it literally isn't. A company's job is to be competitive. While there may be all sorts of libertarian apologists out there anti-competitive action is still... anti-compeititive. Apple's walled garden of an app store among various other tactics aren't about producing a better product - they're about preventing competing products.
    - 7y ago
zelon88 7y ago
There's a downside too. Royalty doesn't cook their own meals. Their time is more valuable than that. Likewise, America doesn't make it's own underwear. We have China to do that. Similarly, they have us to make safe airplanes and complex satellite equipment. Closing trade to the extent that we're making our own underwear INSTEAD of satellite parts can't really be chocked up as a win. It just promotes the notion that China should build their own satellite parts and we should make our own underwear. If making underwear isn't enough to feed a Chinese family, why would we with that destiny upon American families? Tl;Dr, America makes complex, high quality machines and equipment. Refined oil products. Things that require quality over quantity. Things that you can't substitute a generic for. Those are our bread and butter exports. Cheap crap that gets thrown away, like Apple computers, are China's bread and butter. We can either accept these facts and balance markets accordingly (and stay on top at the same time) or we can compartmentalize the world and all be stuck spinning our wheels and duplicating lots of effort, cold-war style, but with stupid-crap like personal computers instead of nuclear weapons and spaceships.
- varjag 7y ago
  Microelectronics, both cheap and expensive, is really the same technology. You move out the high volume base, engineering careers become dead ends and low volume high value products become problematic too. "Let's move production to China and keep R&D here" is a pipe dream.
  - zelon88 7y ago
    Not when it's illegal to export your IP. Those are the contracts where America makes money. All the non-descript brown buildings you pass by on your way to work are the manufacturing/heat-treating/welding/plating shops that make every piece of machinery that flies overhead. Name me one piece of a commercial airliner that you are allowed to source from China. I'll wait. So when you consider what we're currently making, Apple Computers in a massive factory with suicide nets over the windows is a race to the bottom. Nobody wants to compete with Chinese manufacturing on their home turf of cheap Wal-Mart goods. We'll be living in dog cages too if we do that. We want to make airplanes and spaceships and meaningful technology.
squilliam 7y ago
I'm pretty sure that it's referring to the requirements to state that a product is "Made in the USA". Typically it means that atleast 51% of the components are USA-sourced. I think that Apple just got a waiver from the Govt to say the Mac Pro is "Made in the USA" despite not meeting whatever arbitrary guidelines to fulfill that requirement.
- TAForObvReasons 7y ago
  > It will not be considered a deceptive practice for a marketer to make an unqualified U.S. origin claim if, at the time it makes the claim, the marketer possesses and relies upon competent and reliable evidence that: (1) U.S. manufacturing costs constitute 75% of the total manufacturing costs for the product; and (2) the product was last substantially transformed in the United States. https://www.ftc.gov/news-events/press-releases/1997/05/examples-applications-ftc-proposes-new-standard-made-usa-claims https://www.ftc.gov/news-events/press-releases/1997/05/examp... Note the key measure here is cost, and manufacturing costs includes indirect costs like land rent. An easy workaround here would be for Apple to use a shell company to own the land/plants and lease it at exorbitant rates (to hit the 75% threshold)
deleted 7y ago
[deleted]
OldSchoolJohnny 7y ago
That line is critical because it means they will effectively be manufactured in China but some token amount of assembly will happen in the U.S. so that they appear to be seen to be manufacturing in the U.S. when in fact they are made in China in any meaningful non-political sense.
- seanmcdirmid 7y ago
  A lot of the components are not made in China though. The GPU is most definitely not, nor is the CPU. A lot of the low value chips are Chinese, the mainboard probably is, but on a value basis, the most expensive components are not.
  - baybal2 7y ago
    Well, if you don't count that parts not coming from this China, comes from that China. And yes, by far the semiconductor dependence on Taiwan is like another tip of the iceberg thing to the whole process. Just as American big co extremely naive in thinking that they can replace Chinese labour and factories with Vietnam (whose total industrial output is like one district o Dongguan,) it is equivalently naive to think for mainlanders that they can run away from dependence on Taiwan when even Koreans and Japanese can't do it now (Samsung tapes out a lot of ICs at TSMC and UMC, despite having own fabs for cutting edge stuff)
lucideer 7y ago
> I'm happy to see Apple doing this. Even if it's 50% press fluff, I think it'll make other companies in the industry think harder about their own practices because Apple commands such a great reputation. Apple also operate at a scale most companies can't, which means that even without federal product exclusions Apple would still be in a better position to do this than most companies. Those companies in the industry can think all they want, but they're unlikely to get the same federal exclusion, and even less likely to be able to execute anything like this anywhere near as efficiently as Apple. I really don't see how federal subsidies of any kind can be seen as benign when they explicitly target market giants.
- djsumdog 7y ago
  This is also specifically the Mac Pro; which is just insanely expensive to begin with (even before this latest one). With this going mostly to businesses and corporate clients, they can afford to do more domestic assembly or even component sourcing and just pass it on to that limited customer base.
  - bilbo0s 7y ago
    Bingo! This is the one product Apple could build anywhere on the planet and still make a profit. Will probably run between 30 and 50k for configurations that most effects houses would want in any case, so the higher cost of production is no sweat off their backs.
    - esmi 7y ago
      I wonder how true that is. The volume is probably going to be pretty low which means it will harder to amortize the NRE. It’s not just all the hardware engineers either. There probably a ton of specific software, not to mention drivers, in this product too.
  - flyingpenguin 7y ago
    Also because this product is more targeted at business use, assembling it in the US may open the product for more customers. I work in defense and some of our HP computers have to come from a special division of HP that assembles the computers in the US.
arcticbull 7y ago
Does it matter in which country the robots are doing the work? Ultimately that's the future we're shooting for, so this appears to be re-arranging the deck chairs on the Hindenburg.
- solotronics 7y ago
  Yes because we should be the ones building and maintaining our robots as well.
  - arcticbull 7y ago
    It takes about 5 people to run a whole automated factory. The design and development is where the real money is. Let the assembly go to the lowest bidder.
    - vonmoltke 7y ago
      Even with automation, it takes a lot more than five people to run an electronics manufacturing operation. I know first-hand; I supported one earlier in my career.
      - arcticbull 7y ago
        I'm confident that's true but looking into the future, I can't imagine the trend is going to be more people in automated facilities making more money. This is a transient state. The future is basically full automation in manufacturing facilities with zero humans. We need to design society around that instead of pining for the good old days of banging away at metal with a hammer for money. Hyperbolically, this is turning America into a renaissance faire as a make work project.
        solotronics 7y ago
        Barring some disaster that sets humanity back significantly progress will accelerate. There will be a point where most people can't keep up, maybe there will be cybernetic modifications to learn faster. I think there will have to be a new form of economy to support people because already we are straining to assign resources efficiency in the US.
rasz 7y ago
"let us import 200 million of phones and we will totally make ~1 million of this overpriced computer in US"
PunchTornado 7y ago
Don't people in Asia need jobs too? they're already much poorer than the average American. why are you happy?
- serf 7y ago
  >why are you happy? because the happiness of those around oneself is inherently prioritized as more important than others -- it's more involved with personal success than the happiness of those further. is that appropriate? I don't know. It's totally normal, though.
mh8h 7y ago
I guess Apple is hedging against a 2nd term for Trump.
csdreamer7 7y ago
> Is this sort of a "if you don't make us pay tarrifs on component X, we'll build component Y in the USA?" According to GamersNexus on Youtube; power supplies and cases (imported steel) were hit very hard by tariffs. Caselabs, a maker of cases in the US, went out of business partially due to tariffs on imported steel driving up prices. PCBs such as motherboards and graphics cards just moved to Taiwan. Even cheap power supplies went up by $20 at least on average based on my anecdotal price browsing on PCPartPicker.
- mastazi 7y ago
  Sort of tangentially related, Gamers Nexus is one of my favourite PC hardware news outlets, they usually publish articles on their own website [1] with sources backing up what they say in their videos or just expanding with more info[2] (on their Youtube channel, you can often find links to related articles in the video descriptions). [1] https://www.gamersnexus.net/ https://www.gamersnexus.net/ [2] For example you can find more info on tariffs here https://www.gamersnexus.net/industry/3368-manufacturers-on-tariff-impact-to-pc-prices https://www.gamersnexus.net/industry/3368-manufacturers-on-t... and specifically about Caselabs here https://www.gamersnexus.net/hwreviews/3455-caselabs-magnum-sma-8-post-mortem-review https://www.gamersnexus.net/hwreviews/3455-caselabs-magnum-s...
Tinfoilhat666 7y ago
Trump: "Apple will not be given Tariff waiver, or relief, for Mac Pro parts that are made in China" https://mobile.twitter.com/realdonaldtrump/status/1154774656861257732 https://mobile.twitter.com/realdonaldtrump/status/1154774656... Is this a win or loss for Trump? (probably a win because he always wins)

wyldfire 7y ago

> Is this sort of a "if you don't make us pay tarrifs on component X, we'll build component Y in the USA?" Yes, that would be my assessment. Here are the criteria used by the US Govt to grant the tariff waiver [1]: > Whether the particular product is available only from China and specifically whether the particular product and/or a comparable product is available from sources in the United States and/or third countries. > Whether the imposition of additional duties on the particular product would cause severe economic harm to the requestor or other U.S. interests. > Whether the particular product is strategically important or related to “Made in China 2025” or other Chinese industrial programs. [1] https://www.federalregister.gov/documents/2019/09/20/2019-20442/notice-of-product-exclusions-amendment-to-the-exclusion-process-and-technical-amendments-chinas-acts https://www.federalregister.gov/documents/2019/09/20/2019-20...

baybal2 7y ago
Thanks for pulling that link out. Just look at that exemption list. Product category description lists look to me almost exactly like rigged state tenders would look like in some post-Soviet country > LED lighting fixtures, a kind of used in horticulture, containing over 5,000 LEDs spread across 6 light bars > Grills composed of steel wire, each measuring 49cm by 47cm, weighting 0.36kg > Power supplies ... measuring 148cm in length, 43cm in width Those items are pretty much purpose written for individual benefactors
- cl0ckt0wer 7y ago
  Wow, I had to look this up. Great band name! https://en.wikipedia.org/wiki/Chabazite https://en.wikipedia.org/wiki/Chabazite
- _puk 7y ago
  > > LED lighting fixtures, a kind of used in horticulture, containing over 5,000 LEDs spread across 6 light bars Also, really makes one wonder if that sort of specific setup is perhaps the subject of an existing patent. Imagine being in a position whereby there can be no innovation beyond a specific exclusion on a competitive cost basis, and that exclusion being wholly owned already. Seems an alarming way to either enrich incumbents, or stifle Innovation full stop, or both.
  - lonelappde 7y ago
    This insinuation is simply false. Anyone building any product can apply for a waiver under the same general rules. The waivers only apply to the specific products that apply.
    - ken 7y ago
      Big companies like Apple can easily put many people to work applying for exemptions, while small business owners can’t afford to. The mere existence of such a system is rigged in favor of incumbents. This is the “well anyone technically could have” excuse, aka the first chapter of “The Hitchhiker’s Guide to the Galaxy”.
- woah 7y ago
  Reminds me of the detailed but oddly vague exemptions in California’s new AB5 law
- ajdlinux 7y ago
  And if you read the Background section, you'll see that this list is the result of a process where the USTR asked for exclusion requests, and companies had to provide the codes of the specific products they want excluded. "Under the June 24 notice, requests for exclusion had to identify the product subject to the request in terms of the physical characteristics that distinguish the product from other products within the relevant 8-digit subheading covered by the $200 billion action. Requestors also had to provide the 10-digit subheading of the HTSUS most applicable to the particular product requested for exclusion, and could submit information on the ability of U.S. Customs and Border Protection to administer the requested exclusion." So... it's not exactly a surprise if the list reads like it was compiled for the benefit of individual companies. Because... it was.
kerkeslager 7y ago
Wow, what an enlightening link. At first, reading that there's an exemption process, I thought that the bill was better-thought-out than I initially had thought. But then seeing the existing exemptions, I'm realizing that this stinks of lobbying. It's clear that these exemptions are targeted at specific products, and are almost certainly there because some company lobbied to bypass going through the normal exemption process.
- sulam 7y ago
  Yes, but aren't you glad to know our government is looking out for the live bait and tackle vending machine industry?
- rayiner 7y ago
  That’s not the bill. That’s from the federal register, which records decisions of administrative agencies. Assuming you’re talking about Annex A, that is a recording of specific products that the USTR has ruled are excluded in response to existing exclusion requests: > As set out in Annex A, the exclusions are reflected in 38 specially prepared product descriptions, which cover 46 separate exclusion requests. As is clear from Section C, these are decisions on publicly filed exclusion requests that were the subject of public notice and comment. There is in fact a whole website dedicated to explaining what these exclusion requests are and how to apply for them: https://ustr.gov/issue-areas/enforcement/section-301-investigations/section-301-china/200-billion-trade-action https://ustr.gov/issue-areas/enforcement/section-301-investi... As discussed above, criteria for exclusion are things like products that are only available from China, whether the product is strategically important to China, etc. But the decisions are made case-by-case and that’s why the list of excluded products is literally a list of specific products. This is just a funny misunderstanding, but a lot of “the government is so corrupt” type ranting is rooted in these sorts of erroneous readings of legal documents.
  - kerkeslager 7y ago
    Thanks for the correction! It seems I didn't understand what I was reading.
  - 7y ago
jtbayly 7y ago
So, my interpretation is not the same as yours. It does not appear that there is any consideration in this list for something along the lines suggested by the GP. Namely, I don't see "Company agrees to bring production of some other product into the US" as grounds for granting the waiver. Is there any evidence that this was a quid pro quo sort of arrangement?
- wyldfire 7y ago
  That's the vibe I got from the Apple PR. "Yay, still made in USA. This wouldn't have been possible without the exemption we got from the govt for us to import these parts w/o high tariffs." (Simultaneously prostrating ourselves and indicating our resolve to move production if necessary) [1] https://mobile.twitter.com/realdonaldtrump/status/1154774656861257732 https://mobile.twitter.com/realdonaldtrump/status/1154774656...
  - lonelappde 7y ago
    The point is that Apple tried to build a Mac in Texas, but would have to pay a tariff on some component X. So Apple said maybe it's better to build a the whole thing in China since we're paying tariff anyway. And the administration said OK, you can import X without tariff to enable the assembly in TX. It's not Apple's that the tariff pricing structure had perverse incentives.
    - hoseja 7y ago
      Except material/component cost and Apple margins are utterly unrelated.
darksaints 7y ago
Regulatory capture in action right here. I'm willing to bet Apple fully supports these tariffs now that they have their waiver.
- Angostura 7y ago
  If they had achieved waivers on iPhone components perhaps but a tiny volume, high-margin product like the Pro?
- deleted 7y ago
  [deleted]
- lonelappde 7y ago
  Baseless speculation. Especially silly since Apple does not compete on price at all.

Despegar 7y ago

>Is this sort of a "if you don't make us pay tarrifs on component X, we'll build component Y in the USA?" They're basically responding to these stories by WSJ and Bloomberg saying that they're moving production of the Mac Pro back to China. That was never confirmed by Apple and Tim Cook denied it when asked on an earnings call. https://www.wsj.com/articles/apple-moves-mac-pro-production-to-china-11561728769 https://www.wsj.com/articles/apple-moves-mac-pro-production-... https://www.bloomberg.com/news/articles/2019-07-23/apple-seeks-mac-pro-parts-tariff-exclusion-after-move-to-china https://www.bloomberg.com/news/articles/2019-07-23/apple-see...

helpPeople 7y ago

>other companies in the industry think harder about their own practices because Apple commands such a great reputation Great reputation to make Profit isn't the same as Great Reputation. Apple is one of the most hostile and anti competitive company in my lifetime. We should not applaud such business practices. Edit- ib4 "privacy" buzzword

human20190310 7y ago
It's a company's job to be anti-competitive, in the sense of vanquishing its competitors. It gets pathological in the case of regulatory capture, but I don't think Apple has managed that.
- asjw 7y ago
  No, It isn't. The company job is doing well their core business. Mafia's job is to be anti competitive.
  - IOT_Apprentice 7y ago
    The Mafia is not a business. Apple does well in their core businesses.
    - robdachshund 7y ago
      Mafia is straight up a business buddy
- munk-a 7y ago
  > It's a company's job to be anti-competitive No it isn't, it literally isn't. A company's job is to be competitive. While there may be all sorts of libertarian apologists out there anti-competitive action is still... anti-compeititive. Apple's walled garden of an app store among various other tactics aren't about producing a better product - they're about preventing competing products.
  - 7y ago

zelon88 7y ago

There's a downside too. Royalty doesn't cook their own meals. Their time is more valuable than that. Likewise, America doesn't make it's own underwear. We have China to do that. Similarly, they have us to make safe airplanes and complex satellite equipment. Closing trade to the extent that we're making our own underwear INSTEAD of satellite parts can't really be chocked up as a win. It just promotes the notion that China should build their own satellite parts and we should make our own underwear. If making underwear isn't enough to feed a Chinese family, why would we with that destiny upon American families? Tl;Dr, America makes complex, high quality machines and equipment. Refined oil products. Things that require quality over quantity. Things that you can't substitute a generic for. Those are our bread and butter exports. Cheap crap that gets thrown away, like Apple computers, are China's bread and butter. We can either accept these facts and balance markets accordingly (and stay on top at the same time) or we can compartmentalize the world and all be stuck spinning our wheels and duplicating lots of effort, cold-war style, but with stupid-crap like personal computers instead of nuclear weapons and spaceships.

varjag 7y ago
Microelectronics, both cheap and expensive, is really the same technology. You move out the high volume base, engineering careers become dead ends and low volume high value products become problematic too. "Let's move production to China and keep R&D here" is a pipe dream.
- zelon88 7y ago
  Not when it's illegal to export your IP. Those are the contracts where America makes money. All the non-descript brown buildings you pass by on your way to work are the manufacturing/heat-treating/welding/plating shops that make every piece of machinery that flies overhead. Name me one piece of a commercial airliner that you are allowed to source from China. I'll wait. So when you consider what we're currently making, Apple Computers in a massive factory with suicide nets over the windows is a race to the bottom. Nobody wants to compete with Chinese manufacturing on their home turf of cheap Wal-Mart goods. We'll be living in dog cages too if we do that. We want to make airplanes and spaceships and meaningful technology.

squilliam 7y ago

I'm pretty sure that it's referring to the requirements to state that a product is "Made in the USA". Typically it means that atleast 51% of the components are USA-sourced. I think that Apple just got a waiver from the Govt to say the Mac Pro is "Made in the USA" despite not meeting whatever arbitrary guidelines to fulfill that requirement.

TAForObvReasons 7y ago
> It will not be considered a deceptive practice for a marketer to make an unqualified U.S. origin claim if, at the time it makes the claim, the marketer possesses and relies upon competent and reliable evidence that: (1) U.S. manufacturing costs constitute 75% of the total manufacturing costs for the product; and (2) the product was last substantially transformed in the United States. https://www.ftc.gov/news-events/press-releases/1997/05/examples-applications-ftc-proposes-new-standard-made-usa-claims https://www.ftc.gov/news-events/press-releases/1997/05/examp... Note the key measure here is cost, and manufacturing costs includes indirect costs like land rent. An easy workaround here would be for Apple to use a shell company to own the land/plants and lease it at exorbitant rates (to hit the 75% threshold)

deleted 7y ago

[deleted]

OldSchoolJohnny 7y ago

That line is critical because it means they will effectively be manufactured in China but some token amount of assembly will happen in the U.S. so that they appear to be seen to be manufacturing in the U.S. when in fact they are made in China in any meaningful non-political sense.

seanmcdirmid 7y ago
A lot of the components are not made in China though. The GPU is most definitely not, nor is the CPU. A lot of the low value chips are Chinese, the mainboard probably is, but on a value basis, the most expensive components are not.
- baybal2 7y ago
  Well, if you don't count that parts not coming from this China, comes from that China. And yes, by far the semiconductor dependence on Taiwan is like another tip of the iceberg thing to the whole process. Just as American big co extremely naive in thinking that they can replace Chinese labour and factories with Vietnam (whose total industrial output is like one district o Dongguan,) it is equivalently naive to think for mainlanders that they can run away from dependence on Taiwan when even Koreans and Japanese can't do it now (Samsung tapes out a lot of ICs at TSMC and UMC, despite having own fabs for cutting edge stuff)

lucideer 7y ago

> I'm happy to see Apple doing this. Even if it's 50% press fluff, I think it'll make other companies in the industry think harder about their own practices because Apple commands such a great reputation. Apple also operate at a scale most companies can't, which means that even without federal product exclusions Apple would still be in a better position to do this than most companies. Those companies in the industry can think all they want, but they're unlikely to get the same federal exclusion, and even less likely to be able to execute anything like this anywhere near as efficiently as Apple. I really don't see how federal subsidies of any kind can be seen as benign when they explicitly target market giants.

djsumdog 7y ago
This is also specifically the Mac Pro; which is just insanely expensive to begin with (even before this latest one). With this going mostly to businesses and corporate clients, they can afford to do more domestic assembly or even component sourcing and just pass it on to that limited customer base.
- bilbo0s 7y ago
  Bingo! This is the one product Apple could build anywhere on the planet and still make a profit. Will probably run between 30 and 50k for configurations that most effects houses would want in any case, so the higher cost of production is no sweat off their backs.
  - esmi 7y ago
    I wonder how true that is. The volume is probably going to be pretty low which means it will harder to amortize the NRE. It’s not just all the hardware engineers either. There probably a ton of specific software, not to mention drivers, in this product too.
- flyingpenguin 7y ago
  Also because this product is more targeted at business use, assembling it in the US may open the product for more customers. I work in defense and some of our HP computers have to come from a special division of HP that assembles the computers in the US.

arcticbull 7y ago

Does it matter in which country the robots are doing the work? Ultimately that's the future we're shooting for, so this appears to be re-arranging the deck chairs on the Hindenburg.

solotronics 7y ago
Yes because we should be the ones building and maintaining our robots as well.
- arcticbull 7y ago
  It takes about 5 people to run a whole automated factory. The design and development is where the real money is. Let the assembly go to the lowest bidder.
  - vonmoltke 7y ago
    Even with automation, it takes a lot more than five people to run an electronics manufacturing operation. I know first-hand; I supported one earlier in my career.
    - arcticbull 7y ago
      I'm confident that's true but looking into the future, I can't imagine the trend is going to be more people in automated facilities making more money. This is a transient state. The future is basically full automation in manufacturing facilities with zero humans. We need to design society around that instead of pining for the good old days of banging away at metal with a hammer for money. Hyperbolically, this is turning America into a renaissance faire as a make work project.
      - solotronics 7y ago
        Barring some disaster that sets humanity back significantly progress will accelerate. There will be a point where most people can't keep up, maybe there will be cybernetic modifications to learn faster. I think there will have to be a new form of economy to support people because already we are straining to assign resources efficiency in the US.

rasz 7y ago

"let us import 200 million of phones and we will totally make ~1 million of this overpriced computer in US"

PunchTornado 7y ago

Don't people in Asia need jobs too? they're already much poorer than the average American. why are you happy?

serf 7y ago
>why are you happy? because the happiness of those around oneself is inherently prioritized as more important than others -- it's more involved with personal success than the happiness of those further. is that appropriate? I don't know. It's totally normal, though.

mh8h 7y ago

I guess Apple is hedging against a 2nd term for Trump.

csdreamer7 7y ago

> Is this sort of a "if you don't make us pay tarrifs on component X, we'll build component Y in the USA?" According to GamersNexus on Youtube; power supplies and cases (imported steel) were hit very hard by tariffs. Caselabs, a maker of cases in the US, went out of business partially due to tariffs on imported steel driving up prices. PCBs such as motherboards and graphics cards just moved to Taiwan. Even cheap power supplies went up by $20 at least on average based on my anecdotal price browsing on PCPartPicker.

mastazi 7y ago
Sort of tangentially related, Gamers Nexus is one of my favourite PC hardware news outlets, they usually publish articles on their own website [1] with sources backing up what they say in their videos or just expanding with more info[2] (on their Youtube channel, you can often find links to related articles in the video descriptions). [1] https://www.gamersnexus.net/ https://www.gamersnexus.net/ [2] For example you can find more info on tariffs here https://www.gamersnexus.net/industry/3368-manufacturers-on-tariff-impact-to-pc-prices https://www.gamersnexus.net/industry/3368-manufacturers-on-t... and specifically about Caselabs here https://www.gamersnexus.net/hwreviews/3455-caselabs-magnum-sma-8-post-mortem-review https://www.gamersnexus.net/hwreviews/3455-caselabs-magnum-s...

Tinfoilhat666 7y ago

Trump: "Apple will not be given Tariff waiver, or relief, for Mac Pro parts that are made in China" https://mobile.twitter.com/realdonaldtrump/status/1154774656861257732 https://mobile.twitter.com/realdonaldtrump/status/1154774656... Is this a win or loss for Trump? (probably a win because he always wins)