Why is there no mainstream smartphone made in the USA any more?

This is 2021 and there is still no mainstream smartphone made in the USA. The only smartphone we know that has its components manufactured and assembled in the USA is the little known Librem 5 USA. It is a variant of the generic Librem 5, which is not made in the USA.

Have you heard of Librem 5? Likely not. It is nowhere as big as any of the brands that you know – Apple, Samsung, Motorola, Google Pixel, OnePlus, Xiaomi, and the like. So, for all intents and purposes, there are no mainstream smartphones made in the USA.

The big question is, Why? And that is what I shall answer in this article. It boils down to manufacturing advantage: costs of production.

Most smartphones in the world are made in China. Name any of the big brands and most of their production is in China. Some are made in India, Korea, and Brazil. And in some cases, Germany and Rwanda are on the map as well. But the manufacturing base is minute compared to what happens in China. And as such, you will find that those devices are more expensive than their mainstream counterparts.

Because, it costs much less to produce in China than elsewhere on the planet right now. Let me break it down.

Why there is no mainstream smartphone made in the USA?

Let’s look at the main factor – cost of labour. In China, factory workers are sometimes paid as low as $2 per hour for their work. In the United States of America, that cost jumps up to as much as $10 to $15 per hour. If you add other benefits, the cost of production for smartphones, and indeed other items, go pretty high.

With those figures, it will be difficult for anyone manufacturing smartphones in the USA to compete with manufacturers based in China or India.

Have a look at the Librem 5 USA, for example, and you easily see that for the features it offers, it costs much more than the typical smartphone in its category. For its $1,999 price tag, you could buy one of the new cutting edge foldable phones in the market. Yet, the Librem 5 USA is a mid-range smartphone and would ordinarily sell for not more than $350 to $450.

Have you asked why Sony Xperia smartphones cost as much as they do? The production is done in Japan, where labour and other production costs are also higher than what obtains in China. Factory workers in China often get paid peanuts compared to workers in North America, Europe and most of Asia.

If you want smartphones that are made in the USA, you have to be willing to pay much more for fewer features and fewer capabilities than what you are getting now from Apple, Samsung and others. And that is the real dilemma.

Are Americans willing to pay that price to preserve jobs in the country? Another angle to this is the security angle. By outsourcing production of all American electronic items to China, the USA is also opening itself up to security risks.

Are the lower prices worth the loss of jobs and security? Are Americans ready to sacrifice some extra dollars to take back some control of their fate as a nation? But even much bigger is the question: “Even if Americans are willing to pay more, is the rest of the world where American brands like Apple and Google sell their products willing to embrace the increase in prices?”

If they are not, the manufacturers will lose serious market share and have to scale back production from the current levels. Apple would lose its spot in the global smartphone market. Google Pixels would sell in much fewer numbers than they currently do. Business would not be the same for these brands.

These are the reasons why there are no mainstream smartphone made in the USA any more, and until the factors involved change, the situation is likely to stay this way.

MobileChic

That motivated, gadget-loving geeky chic who tries to stay on top of things. Unapologetic iFan.