Apple and Foxconn Admit to Hiring Too Many Temporary Workers in China to Assemble iPhones

Apple and manufacturing partner Foxconn have admitted to recruiting too many temporary staff in one of the world's biggest iPhone factories, following a report from a non-profit advocacy group alleging harsh working conditions (via Bloomberg).


China Labor Watch (CLW), which investigates conditions in the country's factories, published its report on Sunday accusing the two companies of breaching several Chinese labor laws, including one barring temporary staff from exceeding 10 percent of the total workforce.

CLW said undercover investigators worked in Foxconn's Zhengzhou plant in China and found that temporary staff, known as "dispatch workers," made up about 50 percent of the workforce in August, when the supply chain is usually ramped up ahead of new iPhone releases. Chinese labor law allows a maximum of 10 percent.
Our recent findings on working conditions at Zhengzhou Foxconn highlights several issues which are in violation of Apple’s own code of conduct. Apple has the responsibility and capacity to make fundamental improvements to the working conditions along its supply chain, however, Apple is now transferring costs from the trade war through their suppliers to workers and profiting from the exploitation of Chinese workers.
In a statement, Apple said it investigated the percentage of temporary workers among the overall workforce and found it "exceeded our standards," and said it was working with Foxconn to "immediately resolve the issue."

In addition, Apple said it had found that interns at a supplier facility worked overtime at night, something which violating company policy, but that it had corrected the issue. The company said the interns worked overtime voluntarily and were properly compensated.

Despite the admissions, Apple rebutted allegations of lapses in people management and declined to comment on whether the excess amounted to a breach of Chinese labor law.
"We believe everyone in our supply chain should be treated with dignity and respect," Apple said in a statement. "To make sure our high standards are being adhered to, we have robust management systems in place beginning with training on workplace rights, on-site worker interviews, anonymous grievance channels and ongoing audits."
Separately, Foxconn also admitted it had discovered an over-reliance on temporary workers dispatch workers and said it "immediately began a detailed process to ensure that all issues were addressed."

Around 12,000 iPhones are assembled per shift at the Zhengzhou factory, according to CLW's report. However, Apple's 2018 iPhone XS models were said to be more complex to build than 2017's iPhone X and therefore required more workers.

This isn't the first time Apple and Foxconn have come in for criticism over working conditions in Chinese iPhone factories. In 2017, the companies confirmed instances of high school students working overtime to assemble the iPhone X when they shouldn't have been allowed.

Both companies took remedial action over the issue, and Apple sent specialists to the manufacturing plant to work with management to ensure standards were properly followed.

In its latest annual supplier responsibility report, Apple said it conducted 44,000 interviews with supplier employees in 2018 to make sure they were properly trained and knew how to voice concerns. Apple also said it was taking new steps to prevent forced labor.

Apple will hold its annual iPhone-centric event on Tuesday, September 10 at the Steve Jobs Theater on the Apple Park campus, where it is widely expected to unveil three new iPhones alongside an Apple Watch refresh and other announcements.

Note: Due to the political nature of the discussion regarding this topic, the discussion thread is located in our Politics, Religion, Social Issues forum. All forum members and site visitors are welcome to read and follow the thread, but posting is limited to forum members with at least 100 posts.

Tags: China, Foxconn

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China Reportedly Used iPhone Exploits to Target Uyghur Muslims

Last week we reported on Google's discovery of an old iPhone vulnerability – now fixed by Apple – that enabled malicious websites to steal data from thousands of users over a two-year period.


Google described these attacks in its original blog post as "indiscriminate," however a report over the weekend by TechCrunch suggests the websites were part of a state-backed attack that specifically targeted Uyghur Muslims.
The websites were part of a campaign to target the religious group by infecting an iPhone with malicious code simply by visiting a booby-trapped web page. In gaining unfettered access to the iPhone's software, an attacker could read a victim's messages, passwords, and track their location in near-real time.
According to TechCrunch's sources, the Chinese government was allegedly behind the malicious websites, which also infected non-Uygurs who unintentionally accessed these domains because they were indexed in Google search. The FBI is said to have alerted Google to ask for the sites to be removed from its index to prevent infections.

Beijing has long sought to suppress the ethnic minority Uyghur community in the country's Xinjiang state, with brutal crackdowns in the 1980s and 90s leading to significant numbers of Uyghurs fleeing China to seek asylum.

In the past year, at least one million Uighurs have been detained in internment camps, according to the United Nations human rights committee. Beijing claims the centers across Xinjiang are for "vocational training," but a US Congressional hearing on the camps characterized them as "political re-education" centers.

Note: Due to the political nature of the discussion regarding this topic, the discussion thread is located in our Politics, Religion, Social Issues forum. All forum members and site visitors are welcome to read and follow the thread, but posting is limited to forum members with at least 100 posts.

Tag: China

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Trump Says Tim Cook Made ‘Good Case’ That Tariffs Would Put Apple at Disadvantage With Rivals Like Samsung

Apple CEO Tim Cook and U.S. President Donald Trump met for dinner on Friday evening, and Trump has since told reporters that the two discussed the impact of U.S. tariffs on Apple products imported from China.

Melania Trump, Donald Trump, and Tim Cook in August 2018

Trump said Cook "made a good case" that tariffs could put Apple at a disadvantage given that rival Samsung's products would be less impacted by the tariffs, according to Reuters. "I thought he made a very compelling argument, so I'm thinking about it," Trump said, speaking at an airport in Morristown, New Jersey.

The U.S. plans to impose an additional 10 percent tariff on approximately $300 billion of Chinese imports on September 1, but last week it delayed the tariff to December 15 for products including the iPhone, iPad, and MacBooks. Other products like the Apple Watch, AirPods, and HomePod are still set to be impacted September 1.

In a letter to the Trump administration in June, Apple urged against the tariffs, claiming that they would reduce the company's contribution to the U.S. economy and weigh on its global competitiveness.

Note: Due to the political nature of the discussion regarding this topic, the discussion thread is located in our Politics, Religion, Social Issues forum. All forum members and site visitors are welcome to read and follow the thread, but posting is limited to forum members with at least 100 posts.


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Apple’s Stock Surges After U.S. Delays Additional 10% Import Tariff on Products Like Cell Phones and Laptops

Apple's stock has surged around five percent after the United States Trade Representative announced that an additional tariff of 10 percent on approximately $300 billion of Chinese imports will be delayed to December 15 for products such as cell phones, laptop computers, and monitors, per CNBC.


Moreover, the USTR said certain products are being removed from the tariff list based on "health, safety, national security and other factors" and will not be subject to the additional tariff of 10 percent whatsoever. It is unclear if this decision applies to any Apple products or accessories.


The USTR said it will provide additional details and lists of the tariff lines affected by this announcement on its website today.

The new tariff kicks in September 1 for the remaining Chinese imports impacted.

Note: Due to the political nature of the discussion regarding this topic, the discussion thread is located in our Politics, Religion, Social Issues forum. All forum members and site visitors are welcome to read and follow the thread, but posting is limited to forum members with at least 100 posts.

Tags: China, AAPL

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Tim Cook: Apple Saw ‘Great Improvement’ in China in Q3 2019

Thanks to trade-in programs and other promotions, Apple saw significant improvement in iPhone sales in China, Apple CEO Tim Cook said today during today's earnings call covering the third fiscal quarter of 2019.

Cook said that Apple saw "great improvement" in China, returning to growth in constant currency in Greater China with improvements in year-over-year iPhone performance compared to the last two quarters.

We're happy with our performance across the board, including a return to growth in mainland China. We accomplished this despite strong headwinds from foreign exchange, which impacted the top-line growth rate by 300 points compared to a year ago, equivalent to $1.5 billion of revenue. In constant currency, our revenue grew in all five of our geographic segments.
Cook went on to say that Apple is "encouraged" by the results of the initiatives it launched earlier this year, with the company seeing a strong customer response to in0store trade-in and financing programs. iPhone in retail and online stores returned to growth on a year-over-year basis in June, said Cook, and the active installed base of iPhone users reached a new all-time high.

Despite the improvements, iPhone revenue was down during the quarter. The iPhone brought in $26 million, down from $29.5 billion in the third quarter of 2018. For the first time, the iPhone was responsible for less than half of Apple's revenue, with services and wearables making up for the decline in sales.

Cook said that later this year, Apple has "several new products" that it can't wait to share with customers, without going into details. Apple also has multiple services on the horizon, including Apple Card (coming in August), Apple Arcade, and Apple TV+.


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Apple Asks U.S. for Import Tariff Exemption on Parts for New Mac Pro After Shifting Assembly to China

Apple has asked the Trump administration to exclude components for the new Mac Pro and various accessories like the Magic Mouse and Magic Trackpad from being subject to a 25 percent tariff on Chinese imports, according to filings with the Office of the U.S. Trade Representative uncovered by Bloomberg.


The administration has promised relief if companies can show that parts or products can only be obtained in China, among other factors, according to the report. In all of its exclusion requests (search for Apple), Apple indicates that "there are no other sources for this proprietary, Apple-designed component."

The new Mac Pro will be assembled by contract manufacturer Quanta Computer in China, according to The Wall Street Journal. The current Mac Pro, released in 2013, has been assembled in Texas since its release and is Apple's only major hardware product manufactured in the United States.

Last month, an Apple spokesperson said "final assembly is only one part of the manufacturing process," adding that the new Mac Pro is designed and engineered in the United States and includes some U.S.-made components.

Trump's administration has threatened to impose another $300 billion in tariffs on Chinese imports, which would impact nearly every Apple product, but it has so far held off. In a recent letter, Apple warned that these tariffs would reduce its economic contributions and threaten its global competitiveness.

Related Roundup: Mac Pro
Tag: China
Buyer's Guide: Mac Pro (Don't Buy)

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Apple Opens App Design and Development Accelerator in Shanghai

Apple has announced the opening of a new Design and Development Accelerator in Shanghai as part of an effort to support engineering talent and boost growth in China's iOS developer community.


Located in Pudong District, the Accelerator is being launched to give Chinese developers a chance to work closely with Apple experts to enhance their app development skills, learn how to take advantage of the latest Apple software and hardware, and get tips on app marketing and distribution.
"Developers here in China are leading the world with some of the most popular apps on the App Store, and we are proud to be providing this additional support for them," said Enwei Xie, Apple’s head of developer relations, Greater China. "From education to health to entertainment, the innovation we see here is incredible and we can't wait to see what these talented developers will come up with next."
The first Accelerator program focused on how to implement Apple's augmented reality technologies, with an in-depth look at the latest updates to ARKit 3, AR Quick Look, Reality Composer, and RealityKit. According to Apple, the range of activities includes lectures, workshops, labs, guest speakers, train the trainers, and networking on a regular basis.


Apple says Greater China has over 2.5 million app developers, and since 2010, local developers have earned over 200 billion RMB through App Store sales, with over 30 percent of those earnings made in the past year alone.

Shanghai's Accelerator follows a similar scheme Apple launched in 2017 in Bangalore, India. To attend programs, attendees must be registered members of the Apple Development Program and have an Apple ID registered in the region.

Tag: China

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Apple Reportedly Plans to Launch iPhone With Under-Display Fingerprint Sensor in China

Apple intends to launch a new iPhone for the budget-conscious Chinese market that features an under-display fingerprint sensor instead of expensive Face ID technology, Chinese media sources have claimed.

According to English-language Chinese media outlet The Global Times, Apple will release the new "tailored iPhone" in the country to arrest declining sales in the domestic market, which have been worsened by cost pressures from the 18-month long trade war between the U.S and China.

The new phone will reportedly remove Face ID, the facial recognition system for the iPhone, and instead employ an under-display fingerprint function, news site caijing.com.cn reported, citing sources on the upstream industry supply chain. An industry insider revealed that this is likely to "save on costs."

A structured light laser emitter, the major component of Face ID, would cost several hundred yuan, said a Beijing-based representative who preferred to be anonymous. He told the Global Times on Monday that "only Apple can afford it but that would also affect its sales."
Apple has effaced fingerprint recognition entirely in its flagship smartphone lineup, which includes the iPhone XS, iPhone XS Max, and LCD-based iPhone XR. All have a notch at the top of the screen housing the TrueDepth sensing camera in lieu of a Home button, which contained Touch ID's focused capacitive drive ring in earlier iPhones.

Apple was widely rumored to be attempting to integrate Touch ID under the display on 2017's iPhone X, but the company ditched any form of fingerprint scanning after hitting "early line of sight" with Face ID. Chinese smartphone brands like Huawei, Xiaomi, Oppo and Vivo have since gone in the opposite direction and extended the adoption of in-display fingerprint sensing technology from their premium smartphones to mid-range models.

The increased use of fingerprint scanners in smartphone screens is also reportedly being driven by a reduction in sensor prices and the price gap between OLED and LCD panels. This strategy adopted by domestic brands appears to have paid off, with Apple losing many Chinese users who prefer smartphones priced at around 5,000 yuan ($731), which has resulted in an increase in purchases of local brands, according to Monday's report.

Despite the market shift to fingerprint sensing tech, many observers believe Apple is done with Touch ID in smartphones, although the company has explored various in-display fingerprint scanner solutions in the past, including fingerprint sensing MicroLED displays. Touch ID has also found a new lease of life on laptop keyboards, specifically in Apple's MacBook Pro with Touch Bar range and the latest MacBook Air.

Notably, following meetings with suppliers in Apple's Asian supply chain in May, Barclays analysts claimed that 2020 model iPhones will have acoustic fingerprint technology that could allow for full-screen Touch ID.

Regardless, news of Apple's declining sales in China contrasts with the company's most recent earnings results. CEO Tim Cook said in April that performance in China had improved over the previous quarter, thanks in part to a sales tax cut in the country that allowed Apple to decrease the price of its products, and a "much better tone" in the China-U.S. trade relationship.

Tag: China

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Apple’s New Mac Pro Won’t Be ‘Made in USA’ as Production Reportedly Moving to China

While the current Mac Pro has been manufactured in Texas since it was released in 2013, The Wall Street Journal reports that the new Mac Pro unveiled earlier this month will be assembled by Quanta Computer in China.


Quanta is said to be ramping up production of the new Mac Pro at a factory near Shanghai, and given lower wages and closer proximity to other Apple suppliers in Asia, the Chinese manufacturing is expected to cost Apple less than it would to make the computer in the United States.

Quanta already assembles some Apple products, including the Apple Watch. The shift to Chinese manufacturing would allow Apple to avoid many of the issues its U.S. suppliers have faced in assembling the Mac Pro stateside.

Here's a video of how the current Mac Pro is made in the United States:


In a statement, an Apple spokesperson said "final assembly is only one part of the manufacturing process," adding that the new Mac Pro is designed and engineered in the United States and includes some U.S.-made components.

As a high-end, powerful workstation for professionals, the Mac Pro is not a high volume product for Apple, but where it is manufactured is notable given the ongoing trade war between the United States and China. President Donald Trump has urged U.S. companies to manufacture products domestically.

Trump's administration has increased tariffs to 25 percent on $200 billion of Chinese imports and he has threatened to impose tariffs on $300 billion more goods, including many Apple products. Apple has warned that these tariffs would reduce its economic contributions and threaten its global competitiveness.

The all-new Mac Pro is an absolute powerhouse with up to 28-core Intel Xeon processors, up to 1.5TB of ECC RAM, up to 4TB of SSD storage, up to AMD Radeon Pro Vega II Duo graphics with 64GB of HBM2 memory, and eight PCIe expansion slots for maximum performance, expansion, and configurability.

The new design includes a stainless steel frame with smooth handles and an aluminum housing that lifts off for 360-degree access to the entire system. The housing features a unique lattice pattern to maximize airflow.

Apple says the new Mac Pro will be released in the fall, starting at $5,999.

Note: Due to the political nature of the discussion regarding this topic, the discussion thread is located in our Politics, Religion, Social Issues forum. All forum members and site visitors are welcome to read and follow the thread, but posting is limited to forum members with at least 100 posts.

Related Roundup: Mac Pro
Tags: China, Quanta
Buyer's Guide: Mac Pro (Don't Buy)

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Apple Says Trump’s Tariffs Will Reduce Its Economic Contributions and Global Competitiveness

Apple has urged the Trump administration not to proceed with tariffs of up to 25 percent on a fourth set of goods imported from China, which would impact nearly all of its products, including the iPhone, iPad, Mac, Apple Watch, Apple TV, AirPods, Beats, HomePod, batteries, repair parts, and more.


In a letter sent to United States Trade Representative Robert Lighthizer [PDF] this week, Apple warned that the tariffs would reduce the company's contributions to the U.S. economy and weigh on its global competitiveness:
U.S. tariffs on Apple's products would result in a reduction of Apple's U.S. economic contribution.

U.S. tariffs would also weigh on Apple's global competitiveness. The Chinese producers we compete with in global markets do not have a significant presence in the U.S. market, and so would not be impacted by U.S. tariffs. Neither would our other major non-U.S. competitors. A U.S. tariff would, therefore, tilt the playing field in favor of our global competitors.

We urge you not to proceed with these tariffs. Thank you for your consideration of our comments.
Apple outlined many of its economic contributions in the letter, referring to itself as a "proud U.S. company" that is both the largest corporate taxpayer and one of the largest job creators in the country:
Apple is a proud U.S. company and one of the largest job creators in the United States. We are responsible for over 2 million jobs across all 50 states, including Apple's direct employees, employees at our manufacturing and retail partners, and Americans who make their living in the vibrant and growing app economy.

In 2018, after the passage of tax reform in the U.S., we announced our intention to make a total direct contribution to the U.S. economy of over $350 billion over 5 years and we are pleased to report that we are on track to achieve this contribution. We are opening several new sites and adding new jobs to our U.S. employee base.

Apple is also the largest U.S. corporate taxpayer to the U.S. Treasury and pays billions more each year in local property, sales, and employee taxes.

Finally, Apple's products are used by American families, students, businesses, government agencies, schools, and hospitals to communicate, teach, improve health outcomes, and enhance creativity and enterprise.
Last month, analysts at investment bank J.P. Morgan estimated that the tariffs could result in a 14 percent increase in the retail price of an iPhone XS, pushing the cost of the device from $999 to $1,142. However, the company could also choose to absorb the impact of the tariffs on a temporary basis.

The letter was earlier reported by CNBC.

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