There is a common belief in the people that China offers low labour costs, which is why many of the tech giants have set up their manufacturing units there. People believe that the tech giants get their products manufactured in China at lower prices than what they would have to pay to get the work done in any other country. iPhone maker Apple has also been accused of the same on multiple occasions. Apple CEO Tim Cook has responded to those allegations by saying that the company does not prefers China for cheap labour costs but for the skill.
Why Does Apple Prefer China For Manufacturing?
The Apple CEO Tim Cook, in an interview, said, "There is a confusion about China and let me give you my opinion. The popular conception is that companies come to China for low labour costs. I'm not sure what part of China do they go to but the truth is that China stopped being the low labour cost country many years ago. The reason is because of skill, the quantity of skill in one location and the type of skill it is."
Cook added, "The products that we do require advanced tooling and the precision that you have to have in tooling and working with the materials that we do are state-of-the-art. The tooling skill is very deep here (China). In the US you could have a meeting of tooling engineers and I'm not sure we could fill the room. In China you could fill multiple football fields. It's that vocational expertise is very very deep here."
It might be true that as compared to the US, China might still offer lower labour costs but the point raised by Tim Cook about skill can't be ignored either as the nation has built a reputation for its skilled labour force.