Thursday, August 29, 2013

Moto X Costs $4 More to Be Made in the US

Google won praise for moving it's manufacturing plant from China to Texas, but there won't be a Made in America revolution anytime soon.

The extra cost of making the Moto X is a mere $4, but there are other reasons why tech companies won't be in a hurry to move their production bases from Asia back to the US.  The first thing to remember is that the costs of production that have been bandied about on the Intertubes are just estimates, Google hasn't officially commented on the costs (yet).

According to industry experts, the Moto X cost $12 per phone to make the phone in America, whereas it costs Apple $8 per phone to make their iPhones in China, and 50 cents more for Samsung to have it's Galaxy S assembled China-side too.  While a difference of four measly dollars might not look that much, per unit, it adds up to a hell of a difference - $550 million worth of a difference if you believe unofficial figures.

It's true that Apple is shifting it's production of the Macbook to the US, but the Macbook represents a minor product line compared with sales of iPads and iPhones.

The way that Chinese companies house their workers on-site in dorms improves effeciency, especially when last minute design changes are made.  Larger pools of labour and technicians are available in China compared to the US - Apple has 300,000 technical staff supporting it's assembly line workers at their plant in China.


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