First US-made smartphone just as cheap to produce

Aug 28, 2013

Motorola's new Moto X phone doesn't cost more to make simply because it's assembled in Texas, research firm IHS said Wednesday.

The Moto X is the first smartphone to carry the "Made in the U.S.A." designation. Labor costs are higher in the U.S. compared with Asian factories, where phones are typically made. But IHS said the Moto X is about 5 percent cheaper to make than Samsung Electronic Co.'s flagship Galaxy S4 . The firm said the Moto X's overall production cost is just 9 percent more than that of Apple's iPhone 5.

The findings come as little surprise, as the labor cost of a phone is just a small part of its production cost. IHS estimates that labor and other assembly costs Motorola $12 per phone for the Moto X, bringing the production cost to $226. That compares with $207 for the iPhone 5 and $237 for the Galaxy S4. IHS said Motorola is able to keep the cost of parts low by using standard components that don't break much new ground.

By assembling the phone in Fort Worth, Texas, Motorola is able to let customers order custom designs online for delivery within four days. Standard black or white models are available immediately at .

"With the Moto X, Motorola is reaping the public-relations and customization upsides of producing a in the United States, while maintaining competitive hardware costs," said Andrew Rassweiler, senior director for cost benchmarking services at IHS.

IHS said the estimated $12 for assembly is about $3.50 to $4 more than other leading phones.

"Our initial estimate suggests the additional costs of onshoring the Moto X are relatively low," IHS said.

The phone went on sale last Friday, starting with AT&T. It's coming to other carriers, including Verizon this week. The Moto X's price is about $200 with a two-year service agreement.

The Moto X is Motorola's first phone designed from the start under its new owner, Google Inc. The Internet search company bought Motorola Mobility for $12.4 billion last year.

Explore further: Motorola says first US-assembled smartphones coming

4.8 /5 (12 votes)
add to favorites email to friend print save as pdf

Related Stories

Google coming out with two new Android phones

May 31, 2013

Google revealed Thursday that it has two new sophisticated Android smartphones in the works, one of which will have the unprecedented distinction of being made in the United States.

Review: Motorola phone notable for customization

Aug 02, 2013

In the four decades since Motorola first showed off a prototype of the world's first cellphone, the company has watched Apple, Samsung and other innovators surpass it in sales. With Google as its new owner, ...

Recommended for you

Sony's PlayStation 4 sales top seven million

Apr 17, 2014

Sony says it has sold seven million PlayStation 4 worldwide since its launch last year and admitted it can't make them fast enough, in a welcome change of fortune for the Japanese consumer electronics giant.

User comments : 4

Adjust slider to filter visible comments by rank

Display comments: newest first

dirk_bruere
1 / 5 (1) Aug 28, 2013
That is world changing news!
rwinners
not rated yet Aug 28, 2013
That is world changing news!


Probably not. I'm sure that the components are made overseas. I wonder where the total cost of that phone is created. And how many phones does a US worker have to assemble to make 'how much' money?
Jonseer
1 / 5 (4) Aug 29, 2013
Of course it is Texas, where wages are just barely above 3rd. world rates.

If it weren't true than they would have located the factory in Mexico just a couple of hundred miles South and shipped the product over the border tariff free thanks to the free trade agreement Mexico, Canada and the US signed.
Noumenon
1 / 5 (4) Aug 29, 2013
Assembly represents only a small proportion of jobs related to phone manufacturing. For example, the vast majority of employees of the American company, Apple, are Americans..

More news stories

White House updating online privacy policy

A new Obama administration privacy policy out Friday explains how the government will gather the user data of online visitors to WhiteHouse.gov, mobile apps and social media sites. It also clarifies that ...

Hackathon team's GoogolPlex gives Siri extra powers

(Phys.org) —Four freshmen at the University of Pennsylvania have taken Apple's personal assistant Siri to behave as a graduate-level executive assistant which, when asked, is capable of adjusting the temperature ...

Scientists tether lionfish to Cayman reefs

Research done by U.S. scientists in the Cayman Islands suggests that native predators can be trained to gobble up invasive lionfish that colonize regional reefs and voraciously prey on juvenile marine creatures.

Six Nepalese dead, six missing in Everest avalanche

At least six Nepalese climbing guides have been killed and six others are missing after an avalanche struck Mount Everest early Friday in one of the deadliest accidents on the world's highest peak, officials ...

Better thermal-imaging lens from waste sulfur

Sulfur left over from refining fossil fuels can be transformed into cheap, lightweight, plastic lenses for infrared devices, including night-vision goggles, a University of Arizona-led international team ...