Apple is one of, if not the biggest technology names in the modern world. A start-up which started in a garage space of a secluded suburban house has come a long way. When a company gets as significant as Apple has become, every move made is observed and analyzed very closely. The Tech Giant based out of California, USA has stated several times in the past that they are gradually going to dissolve their business relationship with China and various Chinese companies that Apple works quite closely with. But is that really what’s happening?
One of the major reasons for Apple’s humungous profits is the cost-cutting and management which is done very proficiently. China is a huge part of that. Apple gets cheap material and labor from China and sells the final product using its brand name and authority at ridiculously high prices. An article a few years back suggested that the production cost of an Apple iPhone was around $250 or Rs.12,000. The actual price on the market was almost 400% higher. Now you can call that clever entrepreneurship or manipulation of labor and capital, that’s up to your fine judgment.
In the years 2017 to 2020, Apple has opened almost 50 new production houses all over the world. If they were dissolving their relationship with China then out of these 50, China might have had around 4. In reality, the majority of the production houses were opened in China. The number being greater than 30 for China and 7 in US with 7 of the rest of production houses in Taiwan.
Foxconn, a Taiwanese multinational electronics contract manufacturer, has had a business agreement and a stable relationship with Apple for a long time now. When the Pandemic hit the whole world, people around the whole world lost their livelihood but even that process was not devoid of industrial greed. During the pandemic, Foxconn increased the production rate in China whereas decreased the production rate and services in India by 50%. That seems like a bond growing stronger rather than fading out.
The only entities left in the modern world which cannot be manipulated or controlled by the government are MNCs. Even the tension between the USA and China during the term of the Trump government wasn’t able to disrupt the business acquaintance of Apple with China. Apple’s business decisions clearly and openly defied the rock solid intentions of the US Government. The relationship is still developing and all we can do is wait and watch.