Bloomberg reports that Apple plans to spend a record $10.5 billion on improving and optimizing their supply chain including assembly robots, factory automation, milling machines, and other technology.
The information, derived in large part from Apple’s fiscal 2014 capital expenditure forecast, clearly demonstrates that Apple takes full control and ownership of their supply chain, unlike many other companies that tend to throw designs over the fence and leave the details up to their suppliers.
This isn’t a new initiative for the Apple management leadership. Prior to taking over as CEO when Steve Jobs passed away, Tim Cook husbanded the creation/re-engineering of Apple’s existing supply chain. However, it does represent a major “power-up” move since the forecast 2014 capital expenditures represent a 61% increase from the previous fiscal year and a whooping 10X increase over the 2008 numbers.
Doing a bit more research after my previous post on the Apple Mac Pro I found an excellent writeup on the Atomic Delights blog that goes through the entire Mac Pro manufacturing/assembly process step by step.
The article is definitely worth taking a few minutes to read through if you’re interested in what state-of-the-art manufacturing can accomplish, especially if you have the technology and deep pockets of Apple.
Given all the video and photos I process, it’s pretty much a foregone conclusion that my next computer purchase will be the new Mac Pro. Even though it’s a bit pricey, the speed and processing power it is expected to deliver will improve my output and efficiency considerably.
So, it’s good to know that the Mac Pro assembly is being done in the U.S. Although I fully understand that it won’t mean a lot of jobs being repatriated from off-shore to the States, every little bit helps. And, it’s judicious application of robotics and factory automation technology that makes it both cost effective and good business to do the assembly Stateside.
Here’s a look at the Mac Pro manufacturing and assembly process:
The excellent NYTimes article linked below outlines how robotics is bringing manufacturing back from overseas, but without repatriating the jobs we traditionally associate with factories.
While most of this is very positive in terms of the general economic impact, especially on domestic economies, it marks a dramatic shift in perspective - especially when it comes to the perceived value of workers. For example, when referencing Foxconn chairman Terry Gou:
Foxconn has not disclosed how many workers will be displaced or when. But its chairman, Terry Gou, has publicly endorsed a growing use of robots. Speaking of his more than one million employees worldwide, he said in January, according to the official Xinhua news agency: “As human beings are also animals, to manage one million animals gives me a headache.”
Needless to say, it's also become a key issue in the current Presidential election campaign, or at least a political football that both sides want to grab and run with.
The Obama administration says this technological shift presents a historic opportunity for the nation to stay competitive. “The only way we are going to maintain manufacturing in the U.S. is if we have higher productivity,” said Tom Kalil, deputy director of the White House Office of Science and Technology Policy.
All that being said, it's a given that manufacturing jobs will be drastically eliminated in the same way that most agricultural jobs went the way of the Dodo bird during our grandparents generation. The critical question, the question that everyone seems to be ignoring, is what will most of the people in the population do to create meaningful value that others are willing to pay for.
According to a report in Monday's Nihon Keizai Shimbun, Canon, the world's leader in digital cameras with a 20% marketshare, is building two automated plants in Oita Prefecture that are expected to be fully online by 2015.
The first plant, in Utsunomiya City, will fully automate the camera assembly process using robotics eliminating the need for human workers as much as possible. The second plant, in Kunisaki is expected to implement similar advances in Canon interchangeable lens production.
Canon has placed a priority on increasing efficiency and decreasing the human assembly component since 1990. Recent market and environmental changes, including the impact of the March 2010 earthquake and tsunami, difficult foreign currency exchange rates, flooding in Thailand, and the expected challenges with manufacturing in China going forward, seem to have accelerated Canon's initiative to strengthen its manufacturing base in Japan.
Moving production back from overseas factories to domestic doesn't directly correlate to job creation or transfer. Canon has been silent on the exact job impact of their new facilities, however it appears that manufacturing employees associated with Canon camera and accessory production in Oita Prefecture have decreased by half over the past three years.
Via: Nihon Keizai Shinbun