Apple & China’s Economic Rise | NPR Planet Money
- Apple's journey into China involved flying American engineers to train the Chinese workforce in advanced manufacturing and a level of investment that dwarfs the Marshall Plan.
- Patrick McGee's new book,Apple in China: The Capture of the world's Greatest Company,examines apple's deep entanglement with China.
- in 1999, Terry Gou, the head of Foxconn, contacted Tim Cook, then a young operations executive at Apple.
Explore the intricate relationship between Apple and China, a story of capitalism, geopolitics, and national security. This analysis unpacks how Apple’s reliance on Chinese manufacturing, from early production stages in the US to the pivotal role of Foxconn, has become a double-edged sword. understand the ramifications of this dependency, including potential threats to U.S. security and its impact on technological leadership. News Directory 3 offers this crucial viewpoint on Apple’s journey. Discover what’s next for this complex partnership and the broader implications of global manufacturing.
Apple’s China entanglement: A Story of Capitalism, Geopolitics, and National security
Updated June 17, 2025
Apple’s journey into China involved flying American engineers to train the Chinese workforce in advanced manufacturing and a level of investment that dwarfs the Marshall Plan. Apple’s presence in China has been instrumental in the country’s rise as a manufacturing powerhouse. Now,the company is heavily reliant on China’s production capabilities,even as the country becomes a major geopolitical rival of the United States.
Patrick McGee’s new book,Apple in China: The Capture of the world’s Greatest Company,examines apple’s deep entanglement with China. The book presents a narrative of capitalism lifting a nation out of poverty while providing the world with affordable, advanced electronics.Though, it also raises concerns about whether Apple’s reliance on China has threatened U.S. national security and its technological dominance.
An origin story for Apple’s entanglement in China
in 1999, Terry Gou, the head of Foxconn, contacted Tim Cook, then a young operations executive at Apple. This call would prove to be a turning point in Apple’s manufacturing strategy.
Apple was attempting a comeback after nearly declaring bankruptcy two years prior. Steve Jobs had returned to the company,and the success of the new iMac computer was critical.
The iMac’s design was innovative, featuring a translucent plastic casing in various colors. This design required precise manufacturing.
Initially, Apple manufactured its products in the United States.In its early years, steve Jobs’ sister Patty assembled circuit boards for the first Apple computer. later,the company employed a network of immigrants in the Bay Area to assemble circuit boards and power supplies for the Apple II.
Michael Malone’s book, Infinite Loop, describes these early manufacturing practices as operating outside of minimum wage, Social Security, and workplace safety laws.
As Apple’s finances improved,it established a more formal factory in the Bay Area. While the company worked with overseas suppliers, it was hesitant to fully outsource production, believing that its own factories could deliver the necessary quality.
However, after financial difficulties in the mid-1990s, Apple began outsourcing manufacturing to reduce costs and improve efficiency, following the lead of its competitors.
In 1999, Apple manufactured products in its own factories and other companies’ factories across three continents. The iMac’s monitor was initially manufactured by LG, but LG struggled to meet demand.Apple wanted LG to replicate its three-continent production strategy, but LG’s new factories in Wales and Mexico were unsuccessful. LG also proved difficult during contract negotiations.
Terry Gou of Foxconn learned of these issues. Foxconn had been a minor supplier of component parts for Apple, but had recently demonstrated its capabilities by making the external housing for Apple’s Power Mac G4 desktop. Gou envisioned a larger partnership with apple and saw an opportunity with LG’s struggles.
That’s when he called Tim Cook.
What’s next
The book likely delves into the specifics of the deal between Apple and Foxconn, and the subsequent deepening of Apple’s reliance on Chinese manufacturing, and also the geopolitical implications of this relationship.