The Sort-of-Homecoming of Tech Manufacturing

Workers in the  Moto X assembly plant in Texas photo courtesy of Dan Seifert for The Verge, Vox Media

Workers in the Moto X assembly plant in Texas
photo courtesy of Dan Seifert for The Verge, Vox Media

Is tech manufacturing returning to the United States? In a world where almost everything is made in China, being made in the U.S. carries some serious cachet, but there are some other advantages to American plants: U.S. manufacturing plants can provide quicker service for being closer to their customers, have allegedly higher production quality and are a source American jobs. Motorola, Apple and Lenovo so far have all established plants in the U.S.

The most recently hyped U.S. manufacturing venture is the Moto X, the first smartphone to come from Motorola under the guidance of Google; Google bought Motorola Mobility in August of 2013. The Moto X, advertised as a capable but accessible smartphone, made headlines for being the first major league device to be manufactured in the United States.

Well, the Moto X is only made in the U.S. in a manner of speaking. For the most part, electronics “made in the U.S.A.” have their parts made overseas, which are then assembled in the U.S. The distinction here is between “manufacture” and “assembly.” Touting American assembly as a selling point, most companies are careful to note the difference: the Moto X, which (for AT&T customers) can be delivered in personalized color combinations, has the slogan, “Designed by you, assembled in the U.S.A.”

Google has made a stab at a U.S.-made device before, to slightly less fanfare. In the summer of 2012, Google released the Nexus Q, a streaming media player à la Apple TV. The Nexus Q was met with complaints for its limited functionality and for its price tag: $299, which was $200 more than the competing Apple TV. By January 2013, the Nexus Q was pulled from Google’s Play Store.

Maybe the Nexus Q simply came too early, since this year seems to be heralding a surge of electronics assembled in the United States. Apple’s upcoming Mac Pro computer will be assembled in the U.S., and Chinese PC maker Lenovo opened an assembly plant in North Carolina this past June.

Part of the reason to make products in the United States is simply for PR: the “assembled in the U.S.A.” on these products is worth something to customers. But there are also practical reasons. Devices made domestically can be shipped more quickly and more cheaply to customers, and the production quality tends to be higher.

Tom Looney, vice president of Lenovo North America, commented to NPR about the new North Carolina plant: “Time kills deals. We’ve got to do business the way our customers want to do business, and that’s what this facility will give us—the flexibility and speed to beat our competition every day on the streets.”

The most talked-about effect of building in the U.S., however, is the jobs. North Carolina Gov. Pat McCrory celebrated the opening of the Lenovo plant, proclaiming, “Manufacturing is coming back to the country, manufacturing is coming back to North Carolina, manufacturing is coming right back to Guilford County, and this is the beginning of that process. It’s not going to end today, it’s just starting today.”

Apple, meanwhile, claims to be putting $100 million into the Texas manufacturing facility for its upcoming Mac Pros. Apple CEO Tim Cook claimed in an interview with Bloomberg that “Apple has a responsibility to create jobs…and not just in the U.S., but abroad as well. I think we have the responsibility to make great products that we can recycle and that are environmentally friendly. I think we have a responsibility to make products that have a greater good in them.”

Not everyone is so optimistic, though. Tim Worstall at Forbes calculated that 10 million Moto Xs sold a year would amount to 0.0008% GDP added to the U.S. economy. Additionally, electronics assembly is not a profession that requires any large number of workers, and the majority of the manufacturing is still done overseas; it’s just the final few steps that are done on American soil.

Many of the products we’ve seen made in the United States have, so far, not been mainstream consumer products. Barring the Moto X smartphone, the other major products made in the U.S. are the Nexus Q and the Mac Pro. The Nexus Q was an odd device with a high price point and very limited functionality and audience; many regarded it as Google testing the manufacturing waters more than anything. The Mac Pro, meanwhile, is a pricey niche device targeted mainly at professionals.

But, with the advent of the Moto X, commonly-bought consumer products may be finding a real comeback in the U.S. Hal Sirkin, who co-wrote a book about manufacturing returning to the U.S., told the Chicago Tribune, “A fundamental shift is happening faster than we thought, and companies that three years ago would never even have thought about it are not just thinking about it, but building the plants.” What exactly these developments might herald is still up in the air, but if the statements from Motorola, Apple and Lenovo are to be believed, a big change might just be assembling in the United States.

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