Trump says Ap­ple promised three new US plants: Re­port

Muscat Daily - - BUSINESS -

San Fran­cisco, US - The Wall Street Jour­nal (WSJ) on Tues­day re­ported that US Pres­i­dent Don­ald Trump said Ap­ple has promised to ex­pand man­u­fac­tur­ing at home with three new US plants.

WSJ quoted Trump as say­ing that Ap­ple CEO Tim Cook com­mit­ted to build­ing ‘ three big plants’, in the United States.

No de­tails were pro­vided, and Ap­ple did not re­spond to an AFP re­quest for com­ment.

Cook in May an­nounced the cre­ation of an Ap­ple fund to get more peo­ple in the US to do ‘ad­vanced man­u­fac­tur­ing’, kick­ing it off with a bil­lion dol­lars.

Ap­ple build­ing plants in the United States would come as rare com­mon ground with Trump. Cook has pointed out that Ap­ple spent more than US$50bn in the United States last year - buy­ing from sup­pli­ers such as Corn­ing Glass, work­ing with de­vel­op­ers be­hind ap­plica- tions for the Cal­i­for­nia com­pany’s de­vices and more.

Ap­ple has about 80,000 em­ploy­ees in the US and plans to hire thou­sands more ‘in the fu­ture’, ac­cord­ing to Cook.

It is a sign of Ap­ple’s suc­cess but also a thorny prob­lem: A cash stock­pile top­ping a quar­ter of a tril­lion dol­lars, spark­ing de­bate on what do with such mas­sive re­serves.

The tech gi­ant has re­sisted the idea of bring­ing the cash home, be­cause the US tax code al­lows multi­na­tional firms to de­fer prof­its while they are held over­seas but taxes in­come at up to 35 per cent when repa­tri­ated.

Trump vowed while cam- paign­ing that he would force Ap­ple to bring pro­duc­tion to US soil.

Ap­ple is not in the same po­si­tion as au­tomak­ers which re­lo­cated US fac­to­ries over­seas to cut costs, IHS man­u­fac­tur­ing pro­cesses chief an­a­lyst Dan Panz­ica said ear­lier this year. Ap­ple never moved jobs offshore, it cre­ated them there.

“The Ap­ple jobs were never here,” Panz­ica said. “The en­tire sup­ply chain grew in China.”

Ap­ple ben­e­fits in Asia from a net­work that goes be­yond sub­con­trac­tors as­sem­bling smart­phones, tablets or lap­tops. The firm re­lies on a dense ecosys­tem of com­pa­nies that make compo- nents and spare parts for its de­vices as well.

China also of­fers sources of im­por­tant raw ma­te­ri­als, along with cheap, flex­i­ble and abun­dant labour to keep iPhone as­sem­bly lines crank­ing along.

It would be chal­leng­ing to repli­cate that sit­u­a­tion with US work­ers with­out us­ing more ro­bot­ics, un­der­min­ing the po­lit­i­cal aim of cre­at­ing jobs here, ac­cord­ing to some an­a­lysts. Mov­ing iPhone man­u­fac­tur­ing to the US would also likely push up costs, which is not in Ap­ple’s in­ter­ests.

It was seen as more likely that Ap­ple would make a sym­bolic move to ap­pease Wash­ing­ton, such as in­vest­ing more in mak­ing Mac Pro com­put­ers in the US, or in a fa­cil­ity for higher-priced, lim­ited-edi­tion de­vices such as an ‘an­niver­sary edi­tion iPhone’ to mark the hand­set’s 10th birth­day this year.

Ap­ple CEO Tim Cook in May an­nounced the cre­ation of an Ap­ple fund to get more peo­ple in the US to do ‘ad­vanced man­u­fac­tur­ing’, kick­ing it off with a bil­lion dol­lars

Tim Cook

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