Apple Inc. (AAPL) To Invest Heavily In Machines

iphone 8 apple stockElisaRiva / Pixabay

Apple Inc. (NASDAQ:AAPL) is investing a record $10.5 billion in new technologies like assembly robots and milling machines, which will work behind the scenes away from the eyes of the end users. Through these machines, the iPhone maker is looking forward to ramping up the mass production of iPhones, iPads and other upcoming gadgets, overtaking rival Samsung in mass production.

Apple has enough cash to fund such machines

Apple is looking forward to developing a wide range of machines, from one that will be used in polishing the new iPhone 5C’s colorful plastic to laser and milling machines, which will carve out the MacBook’s aluminum body along with testing equipment for the iPhone and iPad camera lenses, says a report from Bloomberg citing sources aware of the development.

“Their designs are so unique that you have to have a very unique manufacturing process to make it,” told Muthuraman Ramasamy, an analyst with consulting firm Frost & Sullivan.  The analyst told Bloomberg that Apple has plenty of cash, which it can use in inventing cutting edge technology, like that which is used in aerospace and defense.

At Apple, the process starts when the industrial design team led by senior vice president Jony Ive offers up a new idea and then works with the company’s hardware engineering group to design and develop large scale methods for products.

Other technology companies differ from Apple Inc. (NASDAQ:AAPL) as they enter into partnerships with the contract manufacturers to do major engineering works for their products, according to Cormac Eubanks, product development director at industrial design firm Frog Design.

More capital expenditure

Apple Inc. (NASDAQ:AAPL) capital expenditure forecasts in fiscal 2014 highlight the company’s effort to make better designs and invent new technology for its manufacturing processes. According to Bloomberg, Apple is entering into exclusive machinery deals investing more than its rivals.

Tim Cook, the man behind the ramping up of the supply chain in Apple Inc. (NASDAQ:AAPL) prior to becoming CEO, is investing money back into the business as sales growth has tapered off due to tough competition from Samsung and other rivals. Manufacturing and designing have always been the core points at Apple, but recently the focus has increased much more. Apple has increased its capital spending in fiscal 2014 by 61% from 2013, and almost 10 times the amount in 2008.

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About the Author

Aman Jain
Aman is MBA (Finance) with an experience on both Marketing and Finance side. He has worked as a Risk Analyst for AIR Worldwide, and is currently leading VeRa FinServ, a Financial Research firm. Favorite pastimes include watching science fiction movies, reviewing tech gadgets, playing PC games and cricket. - Email him at [email protected]

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