please answer me :) 1. Why did Apple make an announcment in 2012 about its manuf
ID: 2584987 • Letter: P
Question
please answer me :)
1. Why did Apple make an announcment in 2012 about its manufacturing operations upcoming in 2013?
2. What qualitative factors would likely have been considered when Apple, Google, and Lenovo made their decisions to invest in U.S. manufacturing facilities? In other words, why would Apple, Google and Lenovo decide to manufacture products in the United States when all of these companies have well-established facilities and supply chains in China.
3. What chalenges will these companies likely face in manufacturing products in U.S plants?
4. What stakeholders are impacted either positively or negatively, from the decision to manufacture in the United States? How are these stakeholders impacted?
5. What ethical issues potentially arise from not producing in the lowest cost location?
Thank you
Explanation / Answer
1. Apple announced its future manufacturing facilities in 2012 to advise the investors that there is huge demand for their products and they are looking at enhancing the capacity. This will increase the earnings of the company in future. A knowledgeable investor can take a decision to invest in Apple shares considering the improvement in earnings because of this new facility
2. As we all know, though cost of manufacturing is low in China, the currency regulations are very strict. The chinese Yuan is also strictly controlled. From time to time China changes its policies too. Also, it’s always better for global companies to diversify their risk by manufacturing in different countries.
3. The main challenge for these companies in manufacturing in US will be the high labor cost and the taxation. The Companies will also face shortfall of skilled labor at reasonable cost due to visa policies in US
4. The Shareholders incremental return will be less on this investment as compared to China. However, overall these facilities are likely to EPS assertive, thereby adding wealth to Investors in the long run
5. There will not be any ethical issues since this is a strategic decision by management to diversify risk by manufacturing in different locations.
1. Apple announced its future manufacturing facilities in 2012 to advise the investors that there is huge demand for their products and they are looking at enhancing the capacity. This will increase the earnings of the company in future. A knowledgeable investor can take a decision to invest in Apple shares considering the improvement in earnings because of this new facility
2. As we all know, though cost of manufacturing is low in China, the currency regulations are very strict. The chinese Yuan is also strictly controlled. From time to time China changes its policies too. Also, it’s always better for global companies to diversify their risk by manufacturing in different countries.
3. The main challenge for these companies in manufacturing in US will be the high labor cost and the taxation. The Companies will also face shortfall of skilled labor at reasonable cost due to visa policies in US
4. The Shareholders incremental return will be less on this investment as compared to China. However, overall these facilities are likely to EPS assertive, thereby adding wealth to Investors in the long run
5. There will not be any ethical issues since this is a strategic decision by management to diversify risk by manufacturing in different locations.
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