LG shuts down Welsh iMac production line
Plant couldn't assemble them cheaply enough for Apple
LG Electronics plant in South Wales has punched out its last iMacs, according to a report local paper the Western Mail. The reason: it can't make Macs cheaply enough to meet Apple's aggressive cost requirements. Apple apparently wanted a $100-250 cut in the cost of production, but LG said that this was impossible without making the line unprofitable. LG told the paper that Apple's decision to cease outsourcing iMac assembly at the plant won't have an impact on jobs - the 600 staff on the iMac production line will be moved over to other computer assembly lines. The plant employs 2000 people overall. Apple's decision apparently leaves Europe without its own iMac production facility, though built-to-order iMacs will presumably continue to ship from its Cork, Ireland plant. Production there was scaled down last year when Apple signed a multi-billion dollar outsourcing deal with LG. Most iMac components are built in South East Asia, with final assembly taking place closer to the machines' final destinations - Mexico for the North American market and Wales for Europe - primarily because it's cheaper to ship bulk components those kind of distances rather than complete PCs. That said, since 90 per cent of the world's notebooks are shipped fully assembled out of the Far East, LG may now take the same approach with the iMac. ®
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