You are absolutely right with sub-contractors and cost. However, there is another cost that needs to part of the equation: Brand value.

Maybe 15 years or so ago, Philips was one of the largest TV set makers with manufacturing and assembly in plants across the globe, including Europe. They transfered everything to Asia, they outsourced, joint ventured and sold. Today they are no significant player in the TV segment anymore, if you buy a Philips TV today you get a "TPV". And Philips made losses in their TV business for years...

On the contrary, BMW has plants across the globe. Their main manufacturing is in Europe in some of the most expensive countries to manufacture (Germany, Austria). They also assemble in the U.S., Africa and China. They are very profitable, they can charge more for their products than competitors, and they have the brand cachet "Made in Germany".

I'm not saying that it would be easy to manufacture consumer electronics cost effectively in Europe. But I think there is brand value that goes down the drain if your manufacturing leaves Europe.

Here is another thought: Nokia seems desparate to get successful in the U.S. What if they opened an assembly plant in the U.S. for some high priced smartphones and go to the market touting "Nokia xyz, the only phone manufactured in the U.S.".

But this would be a creative move and needed smart management to get off the ground. I am sure that smart management is in short supply at Nokia nowadays.