Why can't other countries compete with China in the electronic and smartphone market?
Because all the parts are made in China. They’ve learned how to make these parts cheaply and efficiently and they’ve spent 40 years building the infrastructure to support this. They have transportation, power generation, special economic zones, favorable laws and regulations for importing critical raw materials and exporting finished products… etc etc
The company I work for has factories in both India and in China. The China factory can build product from scratch to the shipping dock in 3 wks. It takes the India factory 11 weeks. India has to import components from China because Indian suppliers frequently miss dates or simply can’t make components of the same quality. Sometimes they ship the wrong components entirely. Indian engineers make mistakes which cause products to be returned. Every bug a firmware developer in India fixes, they create 5 more bugs. It takes 3–5 hours to ship something from Bangalore to Chennai because the transportation infrastructure are so bad. Then the product gets held up in India customs for days to weeks because of some bureaucratic red tape bullshit. Then, true story, products were supposed to ship from Chennai to California on a boat. The major port in California is Oakland. Oakland California. They somehow misprinted the bill of lading so that the shipment would go to Oakland Florida. Florida is on the EAST COAST of the US, and Oakland Florida is and INLAND small town of 3000 people with no port at all. How does that mistake get through the entire country of India without someone catching it? And why aren’t they fired or punished for their stupidity?
Dev Gupta, PhD Engr. & Math (1984)
First you need to understand that even in a Chinese brand phone most of the complex high tech components used ( like the Application Processor, the Modem chip, the Radio Freq. module, … ) are of foreign design and manufacture ( Taiwan, US .. ). Only about half the manufacturing cost of brands like VIVO, Oppo etc. are from activities within China ( e,g. the Camera module by Aptina, this used to be a US company then was bought by China, the display and the Li ion battery, the simpler components like all the mechanical and electro mechanical parts … ). All the final assembly & testing of the Phones is done in China ( adds just 10 % to total cost ) which is how every current big brand ( even Samsung ) outside the US got started in the Mobile Phone business. Then there is the cost to license the operating system software which is typically Android licensed from Google.
Mobile phones were invented (1973) and till 2000 the worldwide business used to be dominated by Motorola, originally a US Co. but since 2012 a brand owned by Lenovo ( itself originally an IBM brand for their Laptops ) of China.
As the inventor of many of these technologies at Motorola in the US, back in 2004 and then again in 2012 ( after ex President Kalam had asked for it ) I had offered the Electronics Ministry of India to set up a complete ( incl. R&D for hardware, manufacturing & software ) Smart Phone mfr. operation ( factories ) in India, using only fellow IITans to ensure success.
But even the Sci. / Tech Ministries in India are run by greedy IAS crooks and after using our proposal as excuse to visit the US several times they blocked it - even though UPA II ( Minister Kapil Sibal ) had already allocated $1.5 billion for it.
At that time ( 2012–13 ) the Chinese had n't designed or built any Smart Phones of their own. Most of the Chinese handset companies were started since then by ambitious Engineers who had worked for the China branch of Motorola when it still used to be a US Co. The Govt. of China financed them.
Govt. subsidies, low labor cost ( assembly labor is plentiful and cheap in China, even a Chinese Engineer earns only about 1/5 of an US Engineer ), good infrastructure, robust and agile supply chains, cost control by volume buying, low markup ( for Apple it is 300%, for the Chinese brands it is just 20 % ) are what makes Chinese phones good enough and affordable for a cost conscious and still mentally colonized / incompetent country like India.
The main competitive edge that China has over India is in the quality of people in their respective Govt.s For the last 30 years China has been run by Engineers, all their Presidents including Xi today are trained Engineers. In contrast India with its fraudulent and incompetent de acy has been run by corrupt dynasties or virtually illiterate rabble rousers, all aided and abetted by the non technical IAS bureaucrats who are arrogant ( take on the airs of British Colonial Administrators ) and greedy, use their Mafia like control of the Govt. to feather their own nests.
Had the IAS scoundrels not blocked our plans, today India will not have to import nearly $50 billion worth of Electronics from its enemy China and might even be exporting some to them.
Of course India has yet another handicap compared to China.and that is its traditional crooked Banias ( traders ). Even the largest of these Traders ( like the Ambanis ) do not wanta to get into high capital, high risk enterprises like manufacturing prefer importing from China instead. Pseudo Indian Smart Phone brands like Micro Max are just rebranded Chinese products. These traders control the current Govt. and have distorted their decision making.
There is really no hope for India so long as it is run by fools and crooks. FYI the avg. IQ of Indians is just 83 ( even lower for Hindi speakers of the BIMARU states ), that for the US 100 and for the Mainland Chinese 103.
But the avg. IQ for IIT ans in Silicon Valley is as high as 115. Too bad that the JEALOUS IDIOTS in India will never let us help India directly, instead heap guilt on us ( "we educated you at public expense and then you abandoned the country to get rich") to beg for handouts !
There are lot’s of smart Chinese people.
B.T. Yang, Born in china and live in Taiwan
Yes, S. Korea can; Japan can….EVAN the US can if they are willing to work at $3/hr.
Bob Thornton, lives in China
It is the sheer amount of labor force and optimized supply chain that makes it difficult for any other country on the planet to compete. Add to that the work ethic, which also cannot be replicated in India or Vietnam.
Yu Maynard, Yantai City (2013-present)
I dont think so friend.
These brands can compete with China.Sony,among of the three,seems likely the most weak,but holds quite a lot distinguished techniques in camera,screen,audio and sensors,may hit the top if he want.
China’s brands have benifited mostly from Chinese huge popularion and the Reform&Openning.On my oppion,I prefer to those brands who treat the cosumers friendly and honestly.
Joe Belkin, studied at Graduated
Government backing in certain industries which includes prestige segments like tech/consumer tech. This was the game plan used by Japan in the 1960’s and South Korea in the 1980’s.
Or closer to home in more covert ways in the US, the tax laws, security laws and even bankruptcy laws favor taking chances and launching new ventures so we get a lot of startups that make instant millionaires/billionaires (and thousands/millions that are never heard of and fail but we’re okay with that unlike most countries) … or more overt, the US defense budget is about $800 BILLIOn, surprise, we have companies that try and get defense contracts.
Giulio Moro, Always testing new apps and configs for mobile VoIP solutions.
The biggest chunk of every manufacturing process is the human labor costs involved, so companies routinely move their facilities to countries where they can play with both widely-varying currency exchange rates and overall inexpensive labor rates and then their products are made at a fraction of their previous costs.
The next manufacturing frontier will be India as they surpass China’s population.
In the 70s-90s it was Mexico for many companies, but it turned-out to be a very bad and costly mistake.
Jeff Gruszynski, 35 Years as an electrical engineer
The US used to dominate electronics. We abandoned and abdicated the market primarily because switching capital infrastructure to the next new things (Printed Circuit Boards) was judged “too expensive” so most American brands outsourced to Japan who was not playing on a level playing field (they got go nment subsidies to create an export market - US companies got nothing from the go nment).
Could be get that industry back? Well, it’s not the same industry it was. It will never create as many jobs as used to exist in electronics because now things are automated in part to save money but more because humans simply can’t or won’t do the jobs as well.
If we have a war with China, we won’t have a choice because currently China manufactures >90% of the world’s electronics either as an OEM or as a direct branded supplier, and that include military electronics supply chains as well: we’ll have to bring it back
Because consumers buy the product that is the least cost and does the job they want done. China is a sl ve state manufacturer (IMHO). That way they can drive down the cost of anything they produce. So, companies that produce items like electronics and actually almost everything can have Chinese corporation make their products cheaply, then bring them to a non sl ve labor country and out price locally made items. Because the consumer is isolated from the manufacturing, they choose the least cost items. Countries should be taxing imports from sl ve labor countries, but don’t, as the consumer likes the lower costs and likely the politicians are bought off by corporations that are profiting by the sl ve labor.
Roberto Santocho, Working with manufacturers in China since the 1980s
Q: Why can't other countries compete with China in the electronic and smartphone market?
A: It’s actually very simple. China has extremely low cost wages, which The West has enjoyed for decades. Thats is it. All the other fancy explanations, of complex macro economic systems are simply unnecessarily complex ways of saying this.