Apple: Yes there are horrendous accidents, but we CARE
Tim Cook sends letter after Chinese factory horror exposé
Tim Cook has sent a letter to all Apple employees stressing how much the company cares about industrial accidents in its Chinese factories.
It comes a day after a graphic story in the New York Times about an explosion in a Chinese iPad factory and two weeks after Apple released a new Supplier Code of Conduct that goes into labour conditions in their factories in unprecedented depth.
Apple didn't officially reply to the NYT story – they refused to comment – but Tim Cook did choose to reply to the accusations in an internal email.
"We care about every worker in our worldwide supply chain," he wrote. "Any accident is deeply troubling, and any issue with working conditions is cause for concern. Any suggestion that we don’t care is patently false and offensive to us."
The May 2011 explosion in a Foxconn factory in Chengdu was blamed on aluminum dust and took place in a unit where workers polished iPads; it left four dead and 18 severely injured.
HP, Microsoft, Dell, IBM, Nokia use exactly the same manufacturers, as Cook points out. But pressure on Apple's ethics seems to have come in particularly hard in the past six months, eliciting an uncharacteristic response from Apple, which is usually unresponsive to criticism.
Apple feeling the pressure?
Possibly it's because Cook, Steve's replacement since September, comes from the supplier side of the company. He's no temperamental visionary like Steve, he was the Chief Operations Officer and directly responsible for the manufacturing side of the company since 1998, notably cutting the slack on Apple's supply chain, helping the company pull in the profits that have seen it cream in money.
Possibly it's the record profits posted by Apple this year, and Apple's brief status this summer as America's most profitable company that have brought it a new level of scrutiny - though Apple has been scoring those since the middle of last year. Its financial prominence and the hero-worship of CEO Steve has made it into a talismanic American company, whose name is often bandied about by politicians.
According to an analysis by iSuppli, Apple's margins on the iPhone 4S are high. A no-contract 16GB iPhone 4S sells for $649. According to its analysis, Apple pays $188 for the components per unit and $8 for the manufacturing. Costs of $196 on a $649 device make for profits of nearly 70 per cent.
Those costs obviously don't include software, advertising, design, transport, packaging, but give an indication of the high profit margins that Apple gets off each handset.
The New York Times alleges that Apple's demands are in some cases harsher than those of other tech employers, and compared it unfavourably with HP. The NYT quoted a contractor as saying:
“The only way you make money working for Apple is figuring out how to do things more efficiently or cheaper [...] And then they’ll come back the next year, and force a 10 per cent price cut.”
Also, Apple's famous desire for secrecy makes working conditions harder to investigate.
In response to the explosion last May, Apple released this response:
We were deeply saddened by events at two of our suppliers in 2011. An explosion at Foxconn’s Chengdu factory tragically took the lives of four employees and injured 18 others. An explosion at the Ri-Teng (a subsidiary of Pegatron) factory in Shanghai injured 59.
Apple listed five improvements it had required manufacturers to make including improved ventilation and ductwork checks.
We've asked Apple for a copy of the email, it's not coughing anything up, but here's the version that 9to5 Mac has. ®