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RE: [Fed-Talk] IPad cost comparison (UNCLASSIFIED)
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RE: [Fed-Talk] IPad cost comparison (UNCLASSIFIED)



Made in USA doesn't seem to be an issue with all the Blackberries in govt.


Gregory Kranich
Supervisory Transportation Security Inspector
U.S. Department of Homeland Security
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-----Original Message-----
From: fed-talk-bounces+gregory.kranich=email@hidden [mailto:fed-talk-bounces+gregory.kranich=email@hidden] On Behalf Of Rex Sanders
Sent: Friday, July 29, 2011 7:02 AM
To: Apple Fed Talk
Subject: Re: [Fed-Talk] IPad cost comparison (UNCLASSIFIED)

I don't know the rules for "Made in USA", so consider this a thought
exercise.

This graphic describes component costs and manufacturing cost for the
iPad 2:

http://www.isuppli.com/PublishingImages/Press Releases/2011-03-12_iPad2_BOM.png

Virtually none of the components are made in USA (some have never been
made in USA), so estimating their costs if made here would be difficult.

The manufacturing cost of $10 probably corresponds to labor costs in
China.

What if we assembled these components in USA?

Using numbers from BLS: http://www.bls.gov/fls/

In 2008 (last year of roughly comparable data), Chinese urban workers
cost $2.36 per hour, USA manufacturing workers cost $32.23 per hour,
or about 13.6 times more.

If assembled in USA, then the price of an iPad 2 might go up $126 if
passed through without markup, or 18% to 25% depending on the model.

=====

This topic often falls under Trade Agreement Act (TAA) compliance and
other procurement rules.

Recent story on that topic for iPads:

http://www.federaltimes.com/article/20110711/IT03/107110301

"iPhones and iPads, however, are not available on the General Services
Administration's Federal Supply Schedules, which are contracts
available for use by any federal agency, because of a special legal
quirk. Those products are manufactured in China, which is not in
compliance with the Trade Agreement Act, and so not on the schedules,
said David Peters, program manager for GSA's Network Programs."

-- Rex

On Jul 29, 2011, at 9:13 AM, Pike, Michael (IHS/HQ) wrote:

> I dont think its off topic... believe it or not the whole "Made In
> China" was a basis one of our procurement people made for not
> ordering macs a few years back.  Apple used to have a special part
> number for items that would classify as "made in the usa" but I do
> not know if they still do that.
>
> mike
>
> On Jul 29, 2011, at 10:06 AM, Blankenship, Bob J Mr CTR US USA IMCOM
> wrote:
>
>> Classification: UNCLASSIFIED
>> Caveats: NONE
>>
>> Has anyone seen any data on how much cost increase on products
>> there would
>> be if it was manufactured in the United States compared to overseas
>> such as
>> the iPad? Would it be in the range of say 10% more or a 40%
>> increase in
>> cost. Guess you might say this post is off topic but thought I
>> would give it
>> a try.
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References: 
 >[Fed-Talk] IPad cost comparison (UNCLASSIFIED) (From: "Blankenship, Bob J Mr CTR US USA IMCOM" <email@hidden>)
 >Re: [Fed-Talk] IPad cost comparison (UNCLASSIFIED) (From: "Pike, Michael (IHS/HQ)" <email@hidden>)
 >Re: [Fed-Talk] IPad cost comparison (UNCLASSIFIED) (From: Rex Sanders <email@hidden>)



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