Robotics, AI and Other Tech

Whether it is White Collar - Office jobs or Manufacturing jobs, the trend of reducing Labor Content continues.


Apple suppliers must invest in automation or face losing orders

Apple is reportedly pushing suppliers to invest in automation to cut production costs. And, if they don't, they risk losing iPhone production contracts.

Aside from components used in production, one of the major costs of building an iPhone is the army of workers needed at assembly partners such as Foxconn. If a report is correct, that army may start to shrink in numbers.

According to sources of DigiTimes on Monday, Apple is pushing to introduce more automation in its supply chain. It has previously expressed a need for the use of robotics and automated systems in production, but now it's upping the ante.

Manufacturers in the supply chain are being told to actively invest in automation for production lines. It's apparently now a requirement if suppliers want to secure contracts and orders from Apple in the future.

The actual cost of the investment is something that the supplier must also work out for themselves. While Apple has previously helped fund investments to improve production, this seems to be something that it is expecting the suppliers to handle directly.

Standardization, protection, and cost
For Apple, a bigger shift to automate its manufacturing ecosystem provides multiple benefits. For a start, it reduces the labor force required to make the iPhone and other products, saving money.

It also means that manufacturing won't be as affected by major events like a pandemic. COVID-19 demonstrated this problem, with restrictions limiting how employees could work in factories.

Automation can also help standardize production between sites. If the same machinery is in use in two different countries, they should create the same results regardless of location.

DigiTimes has a pretty good record when it comes to supply chain moves, rather than for product news. Add in the previous discussion on automation, and it seems to be a very plausible report.

Another trade war change
The report says that Apple's interest in automation is in response to pressure from the United States, especially surrounding its work in China. In part, it's seemingly a response to the earlier Trump trade war with China, rather than the current tariff battle.

Since that time, Apple has worked to diversify its supply chain. This includes establishing enough of a production line in India to handle iPhone 17 assembly for U.S. customers.

Automation would provide some assistance to Apple in creating more bases of operation in the future. It would reduce the need to construct in more populated regions with a capable and low-cost workforce.

Eventually, this could mean the often-repeated call by President Donald Trump to bring iPhone production to the United States could actually become a reality.

Apple has previously talked to the Trump Administration about needing the "robotic arms" to actually make iPhones in the United States. A push to automate more could be baby steps in that direction, albeit one that would still have a lot more obstacles in the way.

 

Analysis - Spin on what it means.

Apple’s going to automate all the iPhone factories

Digitimes tells us Apple is intensively pushing supply partners to invest deeply in automated manufacturing in their factories. This isn’t new, but what has changed is the degree to which the company is insisting on it. The report tells us that if you want Apple to place an order with your company, you must invest in automation.

This isn’t specific to any product. Apple is pushing for this degree of automation across all its supply lines, and while there is an initial cost for its suppliers, this should be mitigated in future due to increased manufacturing efficiency and reduced production costs — mostly, I imagine, through not needing as many humans in the process.

Apple wants to cut the workforce by half
The report describes these moves as part of the company strategy to disentangle its manufacturing systems from China. That’s potentially true, but it is also true that Apple has been investing in smart industrial production for a very long time. And last year we learned the company is investing deeply in automating iPhone production, aiming to slash the number of workers it needs for final assembly by half.

This is already happening, with headcount reductions of up to 30% in some roles. Apple’s investment in Darwin AI was a significant investment in these plans, led by Sabih Khan, Apple’s Chief Operating Officer and Peter Thompson, VP Technical Ops.

Foxconn is investing in the same thing. Robots replaced 60,000 employees in one of its factories in 2016, and the iPhone production partner is also experimenting with humanoid robots. Even before this most recent Apple drive to automate, Foxconn had reduced the quantity of humans it needed to make devices by up to 30%.
I could go on. The signs are there. This is what it all means.

Automatic (not) for the people
There will eventually be manufacturing jobs coming back to former industrialized economies, but they won’t be the same as before. There will be a lot less of them, and the factories you make things in will be lonely places with hardly anyone on site, lots of security, loads of automation, and expertise just one spatial video call away.

Welcome to the future world of smart manufacturing.

What will those factories be like?

It’s easy to imagine a world where the people aren’t. Expect heavily automated production lines and distribution networks, extensive use of robotics, and strategic use of humans for those fiddly jobs robots aren’t good at, and for the highly skilled system maintenance roles.

Semi-skilled labor
That’s not to say you’ll need to be highly skilled yourself — you’ll just need to know enough about what you’re doing not to get hurt and be able to wear a Vision Pro headset to handle challenges with help from the specialist at head office. It’s so much cheaper to employ one hugely skilled specialist and some reasonably smart engineers than to ensure that all the tech workers are equally capable. In some cases, you won’t even need a human at the front end, because the AI-driven robot will be able to collaborate just as well in some tasks.

Though you probably won’t want to risk a $100,000 automaton in any of the more dangerous, high-risk challenges. A squishy human will do them fine, and any subsequent insurance payouts will be cheaper than a new machine, particularly once the human’s family reads the small print in the contract their dearly departed signed.

Feel the energy
Fossil fuel advocates must come round to accepting the probability that all this automation will be powered by some form or renewable energy, which is so much more affordable than traditional energy. Why spend thousands on coal-generated electricity when you can get it free from the sun, once you put some solar panels down?

Imagine that: fully automated factories, churning out products (with liberal use of recycled materials, further lowering manufacturing raw materials costs), with few human workers and free energy. (Fossil fuel energy will still have a big market in AI, of course — at least until the bubble pops).

Your name’s not on the door
This is the future of manufacturing in America, I think. It’s the future of manufacturing everywhere, and Apple (and others) are pressing forward full steam ahead on these ideas. What do you think Apple’s Advanced Manufacturing Fund is for? That $500 billion will no doubt be invested in services and technologies to advance these ideas.

Welcome to the future. You may get a job running security at the door or doing those supremely fiddly, repetitive tasks robots don’t too terribly well — but even those “opportunities” won’t exist forever.