Apple promotes its green, environmentally friendly ethos when it comes to recycling old iPhones and other products through its trade-in program. By taking back customers' old devices, Apple can dismantle the hardware and potentially reuse some materials in future products. However, Apple's recycling program has come under fire, with employee theft and destruction of iPhones during the process cited as major issues in an environmental audit.
A Bloomberg report on supply chains and related lawsuits indicates that recycling efforts haven't been entirely smooth. Due to Apple's stringent standards, recycling companies are closely monitored to minimize the chances of product theft.
Recycle Everything, No Exceptions
In theory, the recycling process is straightforward. Customers hand in their old iPhones to Apple, which then passes them on to electronic waste processors for dismantling. After removing batteries and other components, the remaining parts are shredded into pieces.
Near Toronto, factories like GEEP Canada Inc. conduct this process under tight surveillance and secrecy, with gated premises, metal detectors, and surveillance cameras monitoring every move of the employees.
Apart from Apple's well-known culture of secrecy, part of the reason for surveillance is to ensure compliance with contracts. To some extent, this also means preventing employees from sneaking devices out the door.
These seemingly usable and undamaged iPhones and iPads can be tempting for some employees, prompting company investigators to conduct surprise audits of GEEP's operations.
Apple found inconsistencies in paperwork and discovered two boxes of pristine Apple Watch devices hidden away from cameras. Ultimately, Apple accused GEEP of failing to recycle at least 99,975 items, including iPhones that were reactivated in China rather than destroyed.
In 2020, Apple sued GEEP for breach of contract, seeking $22.6 million in damages, alleging that employees had "orchestrated a scheme" to resell hardware on the gray market. While GEEP admitted to these issues, it attributed them to "rogue employees."
However, four years later, there have been no further proceedings in this case, and it may automatically be dismissed in the coming months.
The astonishing aspect of this case lies not only in the quantity of theft but also in observers' apparent surprise at Apple forcing recycling partners to destroy tens of thousands of easily refurbishable iPhones. While GEEP is the primary example in this investigative piece, other recycling partners also face similar pressures from Apple to ensure that everything entering their facilities is recycled, even if it looks pristine.
Long-term Scrutiny
Part of the problem is that Apple's requirements for recycling partners to destroy devices are extremely strict. This is a problem the company is willing to face as it can attract more e-waste customers.
Since Apple became a customer of GEEP in 2014, thousands of products have arrived at GEEP's facilities for destruction. GEEP's Apple Cage requires the installation of metal detectors to prevent components hidden in employees' clothing from flowing out.
Although Apple stipulates that devices must be destroyed within 45 days of arrival and has representatives regularly supervising the arrival and processing of goods, items still go missing. A source told reporters that trays are shuffled around, and labels are sometimes misplaced, but not enough to raise suspicion.
Theft tactics include accounting and logistical tricks, such as reclassifying goods and tampering with records. Other recyclers face similar scrutiny and investigations from Apple, employing similar tactics. Sometimes, even lower-tech methods are used. One example is an engineer who used the water cooler on a steel pushcart during shifts. The engineer would affix iPhones to the bottom of the cart before it left the iron cage, with guards assuming it was the cart's steel plate causing the metal detector to go off.
Shredding Ineffectively, Yet Necessary
Apple's focus on shredding old devices into bits may not necessarily be the best way to handle old smartphones. While smelting can return used materials to the supply chain, it increases the carbon footprint per device compared to careful disassembly and reuse of components.
Allowing more hardware to be refurbished and resold by Apple could lead to a smaller carbon emissions problem. This approach wouldn't require the massive carbon footprint of large-scale production and would be overall cleaner.
However, shredding does bring several benefits to Apple. Firstly, any chips containing user data are destroyed, protecting the previous customers' information from being leaked.
The process also prevents components like camera modules and chips from being reused, thus preventing the creation of "Franken-devices."
Apple had previously dealt with a massive iPhone repair fraud in China, where thieves would purchase iPhones from stores, remove parts, replace them with damaged or counterfeit versions, then return the iPhones for replacement.
Automation Not Yet Perfected
One way to address recycling issues is by removing humans from the equation, but the report suggests that Apple's attempts haven't been particularly successful.
Recycling robot Liam can only handle one model of iPhone and reportedly does so poorly, to the extent that a cleaner was used for media demos.
While Daisy's successor is more destructive in dismantling devices, it's more successful. It can process up to 200 devices per hour and handle 15 models of iPhone, which is a significant improvement.
Despite improvements and the presence of two Daisy robots, the results haven't met the marketing-driven expectations. It's estimated that Apple's automated efforts can only process 1.2 million iPhones per year, roughly equivalent to two days of the company's sales. Apparently, even though Liam and Daisy don't have a tendency to steal iPhones, they should be destroying the iPhones, but there's still a lot of work that needs to be done by humans.
The temptation for employees to steal iPhones that might be destroyed, along with Apple's close monitoring of their work, will still persist for quite some time.
