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Is Apple Moving iPad Production to Brazil?
zacharye writes "According to JP Morgan analysts Mark Moskowitz and Gokul Hariharan, Apple lowered fourth-quarter iPad orders 25%, the first time there has been a production decrease. This decrease has led some to speculate that the move is more than a response to lower demand, or a wish to operate with reduced inventory. Some insiders see this as a move in production from China to Brazil."
So based on rumors, JP Morgan analysts lowered production forecasts which leads to speculation that iPad is moving production to Brazil. I don't know if I would place much stock in these analyst forecasts. They're almost never right. When the iPad 2 first came out some analysts forecasted really high numbers like 8M the first quarter only to downgrade them later. Their reasoning was since the iPad 1 sold about 7M the previous quarter, the iPad 2 should outsell it. Well the analysts did think that the previous quarter being the holidays or that it might take time to ramp up production for a new product were factors.
Right now it's only rumors that Apple has cut orders to their existing suppliers. It may not be true. Even if it were true, if Apple has done so to bring on more suppliers nothing says those new suppliers are Brazilian. It might be that Apple is simply bringing on other Asian suppliers. Some people are speculating that this means the iPad 3 will launch soon. I would think it is more likely that Apple has cut orders because they are about to launch the iPhone 5 (or whatever it is called) and the iPad 2 shares more of the same components with the iPhone 4.
Well, there's spam egg sausage and spam, that's not got much spam in it.
There are companies that don't manufacture, but still do real work. nVidia is a great example. They don't fab their chips, TSMC does. They also don't build the cards (other than reference boards for OEMs to look at) OEM partners like eVGA do. However they make a lot of money and it isn't off of patent trolling or something. What they do is design the chips. They have shitloads of R&D and simulation and so on and their engineers design the chips, write the drivers, and so on. That they don't own the facilities to make them is of no real consequence. It isn't like someone else could just up and make a graphics chip with no effort. The R&D is as hard or harder than the manufacturing.
Not saying that is quite the same for Apple, just saying that you don't have to be a manufacturer to be doing something worthwhile.
True, it's party all the time over here, so we don't have to worry about corruption in government, high unemployment, high crime rate, high taxes, violence, crap public health and education systems, high taxes, crazy ass traffic, and other shit (besides high taxes) that leave this country economically far behind the other BRICs.
The truly sad part is that a brazilian-made iPad won't be any cheaper than the imported model we currently have. Brazilias usually spend the most on gadgets compared to other nations, due to... you guessed it, high taxes. Even if we have it our way, Apple will get greedy and charge whatever the market will bear (i.e. possiby lower taxes becomes Apple's margin).
And by the way, we drink acohol alright. Ethanol is for cars.
Producing stuff in Brazil might be a bit more expensive in the short term, but they're a lot less likely to steal all of your R&D and sell it to your competitor.
Because if we bring manufacturing jobs back to the US, it decreases the leverage that corporations have when extorting government benefits. Plus it might lead to the unfortunate situation where poor people can afford to live without having to beg for scraps.
Let's not forget having to trust the Chinese government.
"Insiders" don't have to make stupid guesses what this might mean. Insiders _know_ what Apple is doing. That's because they are inside, and that's why they are called "insiders".
The people making guesses about a production move to Brazil are either overpaid information whores who don't have a clue, or some random MacRumors poster, not having much more of a clue, but at least not pretending and getting paid for it.
Well, I saw the movie "Rio" recently and they looked pretty friendly there... and all the birds and animals talk too. Gotta be a nice place I think.
First, since you like talking capital outlay, look in to the equipment they have for their development. Thousands of high end servers, a massive Cadence simulator, high end test equipment, and so on.
Then look at their people. It isn't one guy. It isn't 10 guys, it is thousands. Those salaries start adding up.
You are talking a lot of equipment and a lot of people. It isn't one guy sitting with a desktop.
Finally, just have a look at others that have tried. The market is littered with those that just couldn't compete with nVidia and ATi. You have some like S3 and Matrox that couldn't keep up and so stopped trying, producing only low end ans specialty parts. You have others like 3dfx that did well, but then fell because they couldn't adapt fast enough. You have still others like Bitboys that never managed to launch a product.
Hell Intel even failed. They were trying to launch a dedicated GPU, the Larabee, and it ended up not working out and was canceled. This is from a company that designs processors, has done basic graphics, and fabs chips. They still couldn't compete.
What nVidia does is highly technical and very difficult. It isn't something you do by hiring an engineering grad and telling him "go to it." It is a massively expensive process.