international-trade, tradeWe know for example that when Apple builds an iPhone or iPad it subcontracts most of the production and assembly to foreign companies (like Foxconn). So I would expect that something like the cost of those items would be counted on the foreign side of trade balance (is this correct?).
What about when a US company owns the production and assembly and just uses foreign labor (eg GM builds a car in Canada). Does that count as foreign trade?
How much of the foreign trade deficit is made up of American companies manufacturing offshore?
Yes production made offshore is foreign production. Companies that operate overseas are international companies not American companies. In Apple’s case it is contracting with a third party to produce the product that it imports into the US for distribution and sale. GM also has some vehicles produced in Canada and Mexico. Those cars are imported and would count on the imports side of the ledger.
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