Apple’s Bad Form

Reports today are crediting Apple for moving quickly after a number of suicides at Foxconn last year put the iPhone maker’s largest supplier in media peril.

But what, exactly, did Apple do? From its progress report, released yesterday, it’s hard for me to tell. Yes, Apple upped its supplier audits to 127 last year from 102 in 2009. But is that significant? After all, Apple’s report does not say how many suppliers it has, or whether that number changed from 2009 to 2010. Of the 127 sites audited, 97 were looked at for the first time. For a company that relies so heavily on Third World labor, that’s nothing to be proud of.

Then there’s the little matter of the relationship between Foxconn and Apple. Apple reportedly owns the lines inside Foxconn’s Shenzhen facility. Foxconn builds almost all of Apple’s many lines of iPhones, iPads and iPods, not to mention its other PC products. Few other suppliers have the capacity to handle the volumes of these lines. Thus, can the two really be parted? And if not, then what teeth do Apple’s audits truly have?

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About Mike

Mike Buetow is president of the Printed Circuit Engineering Association ( He previously was editor-in-chief of Circuits Assembly magazine, the leading publication for electronics manufacturing, and PCD&F, the leading publication for printed circuit design and fabrication. He spent 21 years as vice president and editorial director of UP Media Group, for which he oversaw all editorial and production aspects. He has more than 30 years' experience in the electronics industry, including six years at IPC, an electronics trade association, at which he was a technical projects manager and communications director. He has also held editorial positions at SMT Magazine, community newspapers and in book publishing. He is a graduate of the University of Illinois. Follow Mike on Twitter: @mikebuetow

3 thoughts on “Apple’s Bad Form

  1. No real information from Apple.. just spin…

    What is the point of Apple using Foxconn?
    – Apple has to buy the capital equipment? (news to me)
    – The products in question are primarily built by same automated equipment Apple has bought?
    (little actual labor invested in each unit).

    for what?…
    – to pay at a reduced rate for a few minutes of labor / unit?.. (save $5 /iphone?)
    – to off load inventory control responsibilities? (but Apple has won awards for it’s materials management!)
    – to get Foxconn’s cheaper / internally made components? (is that really a good idea?)

    Ok… it may (may) save $5/unit for labor and another $3 for cheaper passives…
    and , yes, $8 / unit does add up to a tidy sum.

    If the cost difference is more… it is because of poor negotiating of component prices in the past.. (history of poor performance at Apple in actual materials management).

    If these were labor intensive products… maybe I could see it making sense.
    If Apple didn’t have to make capital investments.. maybe it would make sense.
    With what little I currently know.. it doesn’t make sense.

    otherwise… Apple, fix the root cause of why you have gone off shore.

    and the rest of us…
    stop being so cheap!

  2. Steve Job’s emphatically said” Foxconn doesn’t operate sweatshops.” Really?

    I worked for them for 3 years and spent considerable time at the Longhua plant where the suicides occured.
    The treatment of the workforce was shameful! Most are peasant girls and non-college educated males who are screamed at, berated, forced to work long hours, etc.

    Apple actually installed the “nets” to catch any future jumpers. How humane.
    Foxconn’s solution to the problem? Remove the life insurance benefit!!
    Terry Gou is a ruthless, heartless shell of a man.

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