[Leica] Leica and Apple

[lrzeitlin at gmail.com (Lawrence Zeitlin)]

When Apple introduced the Mac 512 in 1984 it stressed the fact that its
production line was almost fully automatic. Many manufacturing companies
assume a labor component in the finished product of 50 to 85%. Apple boasted
a manufacturing labor component of about 1%. At the time I was chair of the
Computer Committee of the City Univ. of New York. I, and several colleagues,
were treated to a tour of the Cupertino, CA facility with plenty of wine and
gourmet meals thrown in. NYC was in IBMs back yard and Apple wanted to gain
a foothold. When we visited the plant there were very few employees actually
building Macs. Most of the manufacturing workers were in the assembly and
test departments and in shipping. There were plenty of software engineers,
programmers and paper jockeys.

Apple tried, and mostly succeeded, in getting a profit margin of 30% on
manufacturing when most of the competition worked hard to get a 15% margin.
That explains, in part, why Apple, started 30 years ago by two guys in a
Palo Alto garage, is now the most valuable company in the world with assets
exceeding those of Exxon. It also has 76 billion USD in the bank.Apple has
continued its philosophy of keeping manufacturing labor costs low by now
assembling most of its hardware in China and Taiwan. Both countries have
labor rates a fraction of those in the USA and Europe.

Now if Leica kept its design facility in Germany but manufactured its
cameras and lenses in Asia it would be far more price competitive in the
world camera market. Quality need not suffer. My Rollei 35SE made in
Singapore is the equal of another Rollei 35 made in Germany. My Olympus DSLR
500 made in China works just fine.

Leica is no stranger to offshore manufacturing. The Leica CL, made by
Minolta in Japan, is a superb camera and its 40 mm Summicron, also made in
Japan, is one of the Leica's best normal lenses. Leica itself has partnered
with Fuji and Panasonic. It has made some of its best cameras and lenses in
Portugal and Canada. If it adopted the Apple model, Leica's sales would
increase, its profits would soar, and Herr Kaufman would be ecstatic. Te
only unhappy people would be some members of the LUG. You know who you are.

Larry Z