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Apple Is Making Life Terrible In Its Factories (theregister.co.uk)
An anonymous reader writes: Pressure from Apple to lower costs is driving worsening conditions for workers at the company's manufacturing partners.
This according to watchdog group China Labor Watch, which says that under CEO Tim Cook, the Cupertino giant has asked the companies that assemble its products to cut their own costs, and those demands have led them to cut back on worker pay and factory conditions. Specifically, the group reports that Pegatron has been passing on financial pressures from Apple by committing multiple violations of Chinese labor laws on fair pay and workplace safety.
"Working conditions are terrible, and workers are subject to terrible treatment," China Labor Watch writes. "Currently, Apple's profits are declining, and the effects of this decline have been passed on to suppliers. To mitigate the impact, Pegatron has taken some covert measures to exploit workers."
This according to watchdog group China Labor Watch, which says that under CEO Tim Cook, the Cupertino giant has asked the companies that assemble its products to cut their own costs, and those demands have led them to cut back on worker pay and factory conditions. Specifically, the group reports that Pegatron has been passing on financial pressures from Apple by committing multiple violations of Chinese labor laws on fair pay and workplace safety.
"Working conditions are terrible, and workers are subject to terrible treatment," China Labor Watch writes. "Currently, Apple's profits are declining, and the effects of this decline have been passed on to suppliers. To mitigate the impact, Pegatron has taken some covert measures to exploit workers."
see what the Union free work place get's you!
But at least the workers hearts will be warmed by the thought of Apple's profit margins, if not by their empty stoves.
Ezekiel 23:20
Is it possible this is gov't propaganda to benefit Chinese companies at the expense of Apple?
I'm sure a lot of factories don't follow written guidelines: it's still a 3rd world country with a lot of bribery and cruft. (Then again, I've seen abuse in USA cubicle-land also.)
There have been complaints from other co's that Chinese gov't inspectors inspect and/or publicize with double standard on foreign firms.
Table-ized A.I.
It makes sense, Apple is known to have the largest profit margin by far in the tech industry (close to 40% gross, 20% net), so there is no "room" for them, they have to pass on any drop in revenue to their suppliers. Well, I mean, there is no room if they are adamant at maintaining the largest, by far, profit margin...
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I am not supporting any worker abuse but lets at least get the facts right. Apple's profit margin is around 40%, not 400%. Many people around here make the mistake of looking at manufacturing costs but not factoring in the years of R&D that went into something, the overhead of a company, etc.
Yeah, they're perfectly free to go back to dire poverty and hunger if they want. No one is holding a gun to their heads to force them to feed their kids and have basic shelter.
SJW: Someone who has run out of real oppression, and has to fake it.
From what I understand these types of factories manufacture products for multiple customers. If that is the case then this is a non-Apple story and amounts to Apple bashing. So can anyone list manufactures other than Apple that Pegatron services?
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Apple just isn't being as innovative as they were several years ago. For quite awhile, the iPhone was the best phone out there. Apple includes features that their competitors didn't. Their products were also rock solid, and I could count on not having any problems with OS X and iOS. Their products have always been more expensive, but you could make a strong case that you got what you paid for. Perhaps there's only so much innovation that can be done with smartphones, at least for awhile. I get it that there's only so much of a market for tablets, too. There are other opportunities, though, but Apple isn't getting in on them. People will pay money for a luxury item when you can make the case that it really is better. That was certainly true for a time with Macbooks and iPhones. But it's not true anymore, and most people aren't going to pay more for a luxury item that's no better than a much less expensive product from a competitor.
Apple: now selling commodity products at luxury prices.
Why do you need a union? As long as there isn't work coercion, if you don't like the pay rate, or the quality of the workplace, leave.
Unions are sometimes very good for society. Sometimes management is abusive or corrupt. Sometimes there aren't any good jobs available even if someone wants to leave. Sometimes the company is making excessive profits at the expense of workers. Sometimes unions can correct power imbalances. It's very trite to say "if you don't like the situation leave" but that's not realistic for many people. Many people cannot easily leave their job even if they want to. Unions can be very effective at correcting management abuses and protecting those who are likely to be taken advantage of. Many of the features of the modern working life exist thanks to unions including 40 hour work weeks, paid time off, worker safety laws, engineering standards, and much more.
Are unions always a good thing? Absolutely not. Sometimes unions forget about the health of the company and make excessive demands. Sometimes unions make the companies economically uncompetitive. Sometimes unions protect dead weight or problem workers who really shouldn't be protected. Sometimes unions engage in corrupt behavior.
Unions become a problem when they forget their purpose and get too greedy. Management gets unions when they forget about caring for their employees and get too greedy.
Apple should be negotiating the best rates it's from its suppliers. In fact, being publicly traded, it would be unethical not to.
Woah... hold on there. Just because a company can legally do something does not make it automatically ethical. Maximizing profit is routinely at odds with ethical and responsible behavior. The fact that Apple management has a fiduciary duty does NOT mean they have no other legal or ethical obligations. Fiduciary duty is merely one among many legal and ethical obligations of a company. In fact getting the best piece rate from a supplier often is actually counterproductive. Squeezing a supply chain for every penny actually results in unhealthy suppliers and is bad for the Apple in the long run.
Yeah, they're perfectly free to go back to dire poverty and hunger if they want.
No, they're free to provide for themselves without any help or hindrance from Apple or Pegatron. If that means "dire poverty and hunger" that is only because this is the natural state of the universe; if you want anything else you have to provide it for yourself, either individually or working together with others voluntarily for mutual benefit.
If they choose to work at Pegatron they do so because, despite what anyone else might say about the pay or conditions, they feel that this is their best option. Pegatron has no inherent responsibility to provide for anyone beyond what they mutually agreed to in the terms of employment. The workers' conditions—in the aggregate, including any who were laid off—would not be improved by Pegatron (or Apple) losing customers due to non-competitive pricing, or by losing investors due to non-competitive returns.
If really you want to improve their lot, the most effective strategies would be to increase competition for workers by reducing (not increasing!) the barriers to entry for new businesses, to encourage free trade, and to lift the restrictions on immigration to areas with higher standards of living.
"The state is that great fiction by which everyone tries to live at the expense of everyone else." - Bastiat
People say "profits" a lot. They try to ignore that prices don't follow inflation, and that costs are real.
The long and short of it is, somewhere behind the opaque shroud, Apple goes from selling the last-model iPhone at a 10% profit to selling it at a 10% loss. What's probably actually happening is people just aren't interested in spending on a new phone now, and will take a low-cost phone at a bargain. Apple can't cut the current-model back to that cost, and can't even get the old-model down that low, and so is trying to hit prices that the consumer will pay by cutting costs back.
In other words: the "cutting into profits" is more like "losing business, and facing extinction." Apple isn't going to die out today; they know that if they can't keep their phones in the consumer market, they're going to die out in a decade, maybe. Strategic executives actually look way ahead and try to minimize the likelihood of such an outcome.
You're talking about a 20% mark-up, and you've managed to ignore that Apple will take a 10% mark-up but the consumer won't pay $600 for a $550 phone. If Apple wants to sell a phone like that in a market of $350 full-featured phones, it needs its Chinese manufacturers to deliver a $350 phone that it can *maybe* mark up to $400 as a premium option.
At the base, this happens when competitors are offering top-of-the-line technology at the break-out price point. 10% more for 10% more feature, until you're suddenly paying 50% more for 10% more feature; you stop just at that point, and now your next competitor can only offer a better product at 1.5 times the price. Yours might cost $400, but their barely-any-better gadget now costs $600. Even if most of your market is in mid-tier $250-$300 phones, your major competitor can't distinguish themselves as a better product without a distinguished price point: to stand apart in features, you must stand apart in price.
This is a common strategy for other reasons. You release a low, mid-tier, and high-end flagship product; then the customer sees that the mid-tier product is much cheaper than the top-tier product but almost as good, and buys the mid-tier product due to its excellent value. Without the top-tier product, they make a more price-conscious decision, determining their need rather than bare purchasing efficiency. What I've described is an extension: you ensure that the high-end flagship product of distinction is someone else's, and that it's *very* expensive by way of making the most-expensive *reasonable* product on the market yourself. Maybe nobody buys your Galaxy S7; but they're sure as hell not going to spend twice as much on a fucking iPhone.
Apple has the extra disadvantage of not selling a mid-tier product; they sell the iPhone 5 currently, which broadcasts loudly that it's an out-of-date product because it was the premier product four years ago. If it was called the iPhone 7n (new budget offering), people would perceive it as a modern, budget-friendly phone without all the bells and whistles.
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Its funny how when it comes down to it, Apple is not very good at things like the environment, gender equality, and social responsibility when it comes to THEIR business. But, my God they sure are not shy about smugly commenting to others about how they handle issues like environment, gender equality, and social responsibility.
The main problem with our times is that so many people are willing to give a pass to those who say the "right" things instead of judging if they do them. But hey, does it really matter if they move manufacturing offshore to avoid environmental responsibility as longs they make an emoji about your favorite, pet cause?
"Liberalism is a very noble idea, currently controlled by some very bad people. Be sure you do not get the two confused.