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Asahi Shimbun
a day ago
- Business
- Asahi Shimbun
Japanese suppliers face shrinking role in making iPhones
Parts and components that go into the iPhone 15 Pro Max. The parts and components were provided by Formalhaut Techno Solutions. (Taku Hosokawa) U.S. President Donald Trump is vigorously seeking to restore America's manufacturing might through ratcheting up unprecedented steep tariffs on imports from nations around the world. But the anatomy of Apple Inc.'s iPhone, which is composed of countless parts and components made across the globe, reveals the complicated nature of today's manufacturing process that could thwart Trump's objective. In addition, the scrutiny also shows the declining presence of Japanese suppliers in the making of the ubiquitous device. The iPhone is assembled with some 2,300 parts and components made in Japan, South Korea and many other countries and territories. It is emblematic of high-end electronic gadgets that have greatly benefited from the global supply chain. However, most of the assembly work of iPhones is done in China, a country the Trump administration initially proposed applying a 145-percent tariff on imports from there. 'MADE IN CHINA' ON THE SURFACE iPhone screens are made by South Korea's Samsung Electronics Co., its camera sensor by Japan's Sony Corp. and processor by Taiwan Semiconductor Manufacturing Co. in Taiwan, according to Minatake Kashio, CEO of Formalhaut Techno Solutions, a Tokyo research firm specializing in the anatomy and cost analysis of electronic components. Facilities producing these parts and components are based in more than 20 countries and territories, including Germany, Italy, Morocco and Cambodia. Kashio estimates that the manufacturing cost of the iPhone 16 Pro (128 GB), the latest model released last fall, is about $567 (82,000 yen). The model is priced at $999 in the United States, about $430 more than the manufacturing cost. The disparity reflects the value of the device's intellectual property including the brand value and software. But it is difficult to depict such a value with figures alone in regard to trade statistics. iPhones assembled in China are identified by the label 'Made in China.' When the products are exported to the United States, they will be a source of the growing U.S. trade deficit with China. Apple rakes in around $94 billion (14 trillion yen) in profits by selling more than 200 million iPhones around the world annually. Kashio said identifying electronic components as goods of a certain country is a massive challenge, given today's intricately woven supply networks. 'It is like trying to separate the waters of the Pacific from those of the Atlantic,' he said. Imposing stiff tariffs for components traded across borders will inevitably drive up the production costs. The result, he said, is, like Apple, 'U.S. companies will be hit hardest by Trump's tariffs policy.' TechInsights Inc., a Canadian information platform for the semiconductor industry, surmised that Apple would raise the price of its iPhone 17, a model to be marketed this year, by 10-30 percent if higher tariffs on Chinese imports continued. That could send the price of iPhones soaring worldwide, not just in the U.S. market, according to the outlook. A move by U.S. high-tech giants and other manufacturers to cut their dependence on China for production is under way. Intensifying trade frictions between Washington and Beijing during Trump's first term prompted them to relocate their factories from China to Vietnam and elsewhere as they sought to avoid risks. Apple is one of these firms. It publishes data on its approximate 200 suppliers and where their production hubs are located. China, the data showed, accounted for 33 percent of these suppliers' production bases in 2023, a decline from 48 percent in 2018. Japan, with 16 percent, ranked second in 2018 before being overtaken by Taiwan in 2023. Apart from Taiwan, Vietnam and Singapore are increasingly hosting factories making parts and components for Apple's products. In the assembly of iPhones, however, China represents about 80 percent of the products and India for the rest, according to U.S. media reports. Although Trump has been aggressively pushing to revive U.S. manufacturing, analysts assess that it will be difficult for U.S. high-tech companies to untangle themselves from Chinese connections. Yuqing Xing, professor of international economy at the National Graduate Institute for Policy Studies in Tokyo, said it is not viable to shift iPhone production to the United States. To illustrate his point, Xing cited his tour of a plant in Shenzhen, China, where hundreds of workers build smartphones by hand along assembly lines. What he saw there convinced him that only skilled workers can handle the microelectronic components to build smartphones, a more delicate task than the robots perform at auto factories to build vehicles. 'Are there any skilled workers in the United States who are willing to do the job for a monthly pay of $400?' Xing said. 'The idea of making iPhones in the United States is an illusion.' TechInsights estimated that the price of the iPhone could top $3,500 if the device were assembled in the United States. JAPANESE SUPPLIERS FALLING BEHIND A close examination of the inner workings of iPhones also reveals the diminishing role that Japanese electronics companies are playing. When the first iPhone model was released in 2007, Japanese suppliers provided 30-40 percent of the value of the finished product, according to an estimate by Kashio. The ratio has dwindled to less than 10 percent today. Toshiba Corp. and other Japanese electronics companies, who had been key players in manufacturing semiconductor memory chips in the world, have been replaced by their counterparts in China and South Korea. 'Made in Japan' parts and components still account for more than half of the overall components used to make iPhones. But most of these have tiny profit margins--less than 1 yen--except for the iPhone camera sensors made by Sony. More profitable components such as the displays and processors came from suppliers in South Korea and Taiwan. 'Japanese suppliers have lost a big chunk of their share over the past 15 years in allowing foreign competitors to grab the most profitable parts,' Kashio said. He added: 'The big question is how Japanese companies will deal with manufacturers in other countries now producing parts and components of a similar quality to those made by Japanese suppliers, but at a lower cost.'
Yahoo
a day ago
- Business
- Yahoo
UBS Maintains Neutral Rating on Apple (AAPL), Keeps $210 PT
On Tuesday, May 27, UBS analysts reiterated a 'Neutral' rating with a steady $210 price target for Apple Inc. (NASDAQ:AAPL). This decision came after President Trump posted on social media and threatened to impose a 25% tariff on iPhones that are not manufactured in the US. A wide view of an Apple store, showing the range of products the company offers. Despite this threat, UBS analysts expect the impact of such a tariff on Apple Inc.'s (NASDAQ:AAPL) financials to be relatively small. They estimate the tariff could lower the company's earnings per share (EPS) by about $0.15 to $0.20, which translates to roughly a 2% change if no other mitigating factors come into play. While the direct financial impact on Apple Inc. (NASDAQ:AAPL) may be limited, UBS analysts noted that the tariff threat could still affect the stock price. The uncertainty caused by such threats can influence how investors feel about the company, which could impact Apple Inc.'s (NASDAQ:AAPL) market performance. While we acknowledge the potential of AAPL as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than AAPL and that has a 100x upside potential, check out our report about the cheapest AI stock. READ NEXT: 11 Stocks That Will Bounce Back According To Analysts and 11 Best Stocks Under $15 to Buy According to Hedge Funds. Disclosure: None. Sign in to access your portfolio
Economic Times
2 days ago
- Economic Times
Apple to launch iOS 26, macOS 26 in major rebrand tied to software redesigns
Apple is making the change to bring consistency to its branding and move away from an approach that can be confusing to customers and developers. Today's operating systems — including iOS 18, watchOS 12, macOS 15 and visionOS 2 — use different numbers because their initial versions didn't debut at the same time. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Apple Inc. is planning the most sweeping change yet to its operating system names, part of a software overhaul that extends to all its next Apple operating systems will be identified by year, rather than with a version number, according to people with knowledge of the matter. That means the current iOS 18 will give way to 'iOS 26,' said the people, who asked not to be identified because the plan is still private. Other updates will be known as iPadOS 26, macOS 26, watchOS 26, tvOS 26 and visionOS is making the change to bring consistency to its branding and move away from an approach that can be confusing to customers and developers. Today's operating systems — including iOS 18, watchOS 12, macOS 15 and visionOS 2 — use different numbers because their initial versions didn't debut at the same time.A spokesperson for Cupertino, California-based Apple declined to company will announce the shift at its Worldwide Developers Conference on June 9. The branding will accompany fresh user interfaces across the operating systems — an attempt to ensure a more cohesive experience when people move between devices. The new look, dubbed Solarium internally, will include tvOS, watchOS and parts of visionOS, Bloomberg News reported this latest naming strategy is reminiscent of approaches taken by both Samsung Electronics Co. and Microsoft 2020, Samsung renamed its flagship Galaxy S phone line after its launch year, moving to the Galaxy S20. That device's predecessor, which debuted in 2019, was the Galaxy S10, representing the 10th generation. In 1995, Microsoft shifted to naming major operating systems after the year they launched, rolling out Windows 95 and then Windows 98 and Windows big difference is Apple will use the upcoming year rather than the current one. Though its next operating systems will launch around September 2025, they'll be named for 2026 — not unlike how car companies market their vehicles. If Apple keeps the strategy, the following set of releases will carry the 27 previously attempted something similar with its software bundles for office work and creativity apps. In August 2007, it rolled out iWork '08 and iLife '08. That was eventually followed by iLife '11, which went on sale in October part of the changes, Apple plans to give the iPad a more Mac-like experience, potentially making it more useful for office work. And the company is opening up its AI models to third-party developers, letting them tap into the underlying technology used by the Apple Intelligence new features coming this year include a live-translation mode for AirPods and the Siri voice assistant, as well as an eye-scrolling option on the Vision Pro headset. In the artificial intelligence realm, Apple is planning health features and an AI-enabled battery management also will be a new bidirectional Arabic and English keyboard, a digital calligraphy pen for Apple Pencil users and a new app for gaming on Apple devices.
Time of India
2 days ago
- Time of India
Apple to launch iOS 26, macOS 26 in major rebrand tied to software redesigns
Apple Inc. is planning the most sweeping change yet to its operating system names, part of a software overhaul that extends to all its devices. The next Apple operating systems will be identified by year, rather than with a version number, according to people with knowledge of the matter. That means the current iOS 18 will give way to 'iOS 26,' said the people, who asked not to be identified because the plan is still private. Other updates will be known as iPadOS 26, macOS 26 , watchOS 26, tvOS 26 and visionOS 26. Apple is making the change to bring consistency to its branding and move away from an approach that can be confusing to customers and developers. Today's operating systems — including iOS 18, watchOS 12, macOS 15 and visionOS 2 — use different numbers because their initial versions didn't debut at the same time. A spokesperson for Cupertino, California-based Apple declined to comment. The company will announce the shift at its Worldwide Developers Conference on June 9. The branding will accompany fresh user interfaces across the operating systems — an attempt to ensure a more cohesive experience when people move between devices. The new look, dubbed Solarium internally, will include tvOS, watchOS and parts of visionOS, Bloomberg News reported this week. The latest naming strategy is reminiscent of approaches taken by both Samsung Electronics Co. and Microsoft Corp. In 2020, Samsung renamed its flagship Galaxy S phone line after its launch year, moving to the Galaxy S20. That device's predecessor, which debuted in 2019, was the Galaxy S10, representing the 10th generation. In 1995, Microsoft shifted to naming major operating systems after the year they launched, rolling out Windows 95 and then Windows 98 and Windows 2000. The big difference is Apple will use the upcoming year rather than the current one. Though its next operating systems will launch around September 2025, they'll be named for 2026 — not unlike how car companies market their vehicles. If Apple keeps the strategy, the following set of releases will carry the 27 moniker. Apple previously attempted something similar with its software bundles for office work and creativity apps. In August 2007, it rolled out iWork '08 and iLife '08. That was eventually followed by iLife '11, which went on sale in October 2010. As part of the changes, Apple plans to give the iPad a more Mac-like experience, potentially making it more useful for office work. And the company is opening up its AI models to third-party developers, letting them tap into the underlying technology used by the Apple Intelligence platform. Other new features coming this year include a live-translation mode for AirPods and the Siri voice assistant, as well as an eye-scrolling option on the Vision Pro headset. In the artificial intelligence realm, Apple is planning health features and an AI-enabled battery management mode. There also will be a new bidirectional Arabic and English keyboard, a digital calligraphy pen for Apple Pencil users and a new app for gaming on Apple devices.
Time of India
2 days ago
- Time of India
Apple to launch iOS 26, macOS 26 in major rebrand tied to software redesigns
Apple Inc. is planning the most sweeping change yet to its operating system names, part of a software overhaul that extends to all its devices. The next Apple operating systems will be identified by year, rather than with a version number, according to people with knowledge of the matter. That means the current iOS 18 will give way to 'iOS 26,' said the people, who asked not to be identified because the plan is still private. Other updates will be known as iPadOS 26, macOS 26, watchOS 26, tvOS 26 and visionOS 26. Apple is making the change to bring consistency to its branding and move away from an approach that can be confusing to customers and developers. Today's operating systems — including iOS 18, watchOS 12, macOS 15 and visionOS 2 — use different numbers because their initial versions didn't debut at the same time. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like An engineer reveals: 1 simple trick to get all TV channels Techno Mag Learn More Undo A spokesperson for Cupertino, California-based Apple declined to comment. The company will announce the shift at its Worldwide Developers Conference on June 9. The branding will accompany fresh user interfaces across the operating systems — an attempt to ensure a more cohesive experience when people move between devices. The new look, dubbed Solarium internally, will include tvOS, watchOS and parts of visionOS, Bloomberg News reported this week. Live Events The latest naming strategy is reminiscent of approaches taken by both Samsung Electronics Co. and Microsoft Corp. Discover the stories of your interest Blockchain 5 Stories Cyber-safety 7 Stories Fintech 9 Stories E-comm 9 Stories ML 8 Stories Edtech 6 Stories In 2020, Samsung renamed its flagship Galaxy S phone line after its launch year, moving to the Galaxy S20. That device's predecessor, which debuted in 2019, was the Galaxy S10, representing the 10th generation. In 1995, Microsoft shifted to naming major operating systems after the year they launched, rolling out Windows 95 and then Windows 98 and Windows 2000. The big difference is Apple will use the upcoming year rather than the current one. Though its next operating systems will launch around September 2025, they'll be named for 2026 — not unlike how car companies market their vehicles. If Apple keeps the strategy, the following set of releases will carry the 27 moniker. Apple previously attempted something similar with its software bundles for office work and creativity apps. In August 2007, it rolled out iWork '08 and iLife '08. That was eventually followed by iLife '11, which went on sale in October 2010. As part of the changes, Apple plans to give the iPad a more Mac-like experience, potentially making it more useful for office work. And the company is opening up its AI models to third-party developers, letting them tap into the underlying technology used by the Apple Intelligence platform. Other new features coming this year include a live-translation mode for AirPods and the Siri voice assistant, as well as an eye-scrolling option on the Vision Pro headset. In the artificial intelligence realm, Apple is planning health features and an AI-enabled battery management mode. There also will be a new bidirectional Arabic and English keyboard, a digital calligraphy pen for Apple Pencil users and a new app for gaming on Apple devices.
