I just read the article over on the Verge about Tim Cook’s visit to the Foxconn production site in China a few days ago.
One thing jumped out at me:
The plant, located in the Foxconn Zhengzhou Technology Park, is the world’s largest smartphone production base, having 95 production lines, and employing about 120,000 people.
This made me think on the ongoing brouhaha about getting Apple to bring the manufacturing & assembly work back to the US. Leaving aside all of the supply-side logistics issues (which alone are practically insurmountable), has there ever been a company or industry in the US that employed 120,000 people on a single site?
I’m having some trouble wrapping my head around the scale that Foxconn operates. I used to live in Bloomington/Normal, IL, combined population of about 100K. State Farm, the largest local employer has about 10,000 employees at the Corporate South campus. Trying to imagine the entire population all working at the same company, building the same products without even taking into account the ancillary structures including all of the service industries around the production employees just defies imagination. Without actually building a new city from the ground up, how could you integrate anything of this scale into the existing infrastructure and real estate market in the US? Just the mechanics of 120,000 commuters going to the same place would require a public transportation project on a massive scale. Traditional car commuting would be begging for traffic jams.
The on site dorms approach used in China would demand a significant cultural shift as currently the only two environments in north american culture that still work this way are universities and the military.
As analysts are prone to pointing out, Apple operates on such a scale that in order for new products to “move the needle”, they have to be huge. The same applies to the production side. Moving a small number of production lines would be a boutique operation with little impact on the total volume and thus of little interest.
The bottom line is that these decisions have little or nothing to do with the relative salary costs and everything to do with logistics.