Home Technology Apple Inc. (AAPL) Supplier Foxconn Hiring At A Factory Near You?

Apple Inc. (AAPL) Supplier Foxconn Hiring At A Factory Near You?

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In a recent interview, Tim Cook noted that they plan to bring back production of certain Mac products in the U.S. Apple Inc. (NASDAQ:AAPL) plans to invest $100M to ramp-up production capacity in N. America for Macs in 2013.  Analysts at RBC notes that much of this manufacturing will be done by Foxconn Technology Co., Ltd. (TPE:2354) and not U.S.-based EMS companies. Also, there have been reports (i.e., Bloomberg) that Foxconn is evaluating manufacturing sites in N. America (Detroit, MI or Long Beach, CA).

AAPL Details

In a recent interview, AAPL CEO noted they plan to bring production of one entire line of Macs to the U.S. in 2013. While they didn’t comment on which exact product line will be manufactured in the U.S., they did mention they are investing $100M with manufacturing partners to ramp-up capacity in the U.S. for 2013.

Foxconn The Likely Supplier

All this news coincides with Foxconn’s recent comments about looking to doing more manufacturing in the U.S. given customer preferences. Foxconn Technology Co., Ltd. (TPE:2354) has a few assembly and enclosure sites in the U.S. but has recently been looking for manufacturing locations in Detroit, MI and Long Beach, CA according to various news reports (i.e., Bloomberg). Also, Foxconn Technology Co., Ltd. (TPE:2354) has sizable manufacturing locations in Houston, City of Industry and Indianapolis.

Unlikely N. America EMS Companies Get The Contract

While Flextronics International Ltd. (NYSE:FLEX) and Jabil Circuit, Inc. (NYSE:JBL) are both component suppliers to Apple Inc. (NASDAQ:AAPL), we don’t believe either of them will be assembly partners for Apple Inc. (NASDAQ:AAPL) in N. America. In recent years both Flextronics International Ltd. (NYSE:FLEX) and Jabil Circuit, Inc. (NYSE:JBL) have been shifting focus away from assembly of consumer centric products and towards high-mix/low volume manufacturing sectors(Medical/healthcare, etc). Their focus on the consumer side is also moving towards value-added components where engineering can be a differentiator.

AAPL’s Supply-Chain

While Apple Inc. (NASDAQ:AAPL) has often listed 150 key suppliers as part of its hardware ecosystem, its manufacturing has been largely done by Foxconn, along with a few Asian ODMs that are secondary suppliers for various products.

RBC suspects that Apple Inc. (NASDAQ:AAPL) may stick with Foxconn for manufacturing in the U.S. as well given they have been an integral part of AAPL’s supply-chain and have managed AAPL’s supply-chain for multiple products making them better positioned to handle such a transition.

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Sheeraz Raza

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