When people ask why Apple doesn’t make its iPads in America, the usual explanation is that labor costs are so high, there’s no way an iPad could be made in the country for less than $1000. That answer has always lacked weight, as the manual labor of constructing an iPad is actually a very small portion of its overall build cost: building an iPad in America would cut down margins, but not double the price.
No, there’s a better reason why every iPad gets made in China, and you can find it on your local periodic table. Every iPad is made with a sizable number of rare earth metals… all of which can only be mined in China.
Over at iFixIt, there’s a fantastic post that explains why it’s so hard to make an iPad outside of China… or, for that matter, any other gadget.
What it all comes down to is that China has a monopoly on 17 hard-to-mine elements that are necessary for making gadgets. In the iPad, it’s suspected that these earth metals are used to make the iPad’s lithium-ion polymer batteries, the display, the magnets to attach the Smart Cover, and even to polish the glass.
Can’t Apple go somewhere else for these metals? Not really. At best, only 5% of the world’s rare earth metals come from mines outside of China, and while there are companies in Australia and America that are gearing up operations, it’ll be a long time to come before they can supply enough of these in-demand elements to handle orders of Apple’s magnitude.
Rare earth metals also can’t be easily recycled. Although there’s no shortage of old gadgets rotting in scrap heaps and landfills, none of the companies who are working on rare earth metal recycling have managed to actually recover any.
Okay, so rare earth metals are hard to get outside of China. Why can’t Apple just export them? Simple: China exploits their monopoly, and the only way they’ll let you export rare earth metals — even in components — is if you actually manufacture the vast majority of it in China.
I suppose the bright side of all of this is that by staying in China, Apple is leading by example and improving working conditions for hundreds of thousands of workers. Over time, that’ll be a net gain for China. There’s no other way around it, though: in every other respect, manufacturing iPads in China with a lingering amount of rare earth metals is a deal with the devil..