While I do agree with you about the Squiers, and some of the others, as Mozzi pointed out, the Indonesia PRS factory are not making other brands guitars, and the comment about a “step down in quality” is completely unfounded and has no basis in fact as it pertains to PRS. I have had 2 S2s (US made) with wiring problems, nothing that I couldn’t fix with minimal effort, but the point being that every manufacturer, no matter how high their quality standards, will have some defects, it is just a fact of life. It seems apparent to me that PRS have very, very few defective guitars, likely much better than any other guitar brand that is manufactured in mass quantities.[/QUOTE
I think PRS actually make fewer core guitars a day than Gibson's Custom shop making all the 're-issues' - not including all the other guitars Gibson make. Fender make as many instruments a day than PRS does in a month or there abouts. Mass manufacture is perhaps too strong a word if you compare to Fender and Gibson.
It seems to me that PRS, certainly with the core models and I wouldn't be surprised if the same process also extends to the CE and S2 models, will not move a guitar forward to the next stage until the QC check determines that its ready. For example, the sanding after a body comes out of CNC, if that isn't done to the standard expected, it will not go on to having its neck fitted until its ready to go forward. Its those QC checks that mean any issue is dealt with before man hours are wasted on a substandard guitar that fails its final QC. Its too late to go back and sand the body after the neck is fitted, too late to clean all the glue around the neck that's squeezed out - not without stripping the guitar back down and fixing those things and then needing to respray and refit the guitar. Its those QC checks at every stage that generally cut out the inconsistency and human error. Any errors can be corrected - even scrapped if its that bad rather than waste time and resources on trying to make the guitar fit to progress to the next phase.
That may mean that a guitar takes a bit longer to make it to retail but its better than releasing a guitar with issues. I believe that the bulk of a guitar is made by humans - not robots and CNC doesn't take the raw ingredients and pop out a guitar at the other end. Gibson custom shop guitars are not 'perfect', no evidence of the human element in the build process. It may only be a small, insignificant cosmetic blemish that doesn't impact on the playability, function or sound but if you want to look at things under a microscope, they too can have issues and these cost 8-10x as much as a SE does. I think if a guitar functions, plays and sounds like it should with no major cosmetic issues, then I don't really see the problem. Even then, the person buying is the last point of QC and, if the issue is 'too much' for them to accept, then don't buy or, if you ordered online, send it back - and that extends to any guitar at any price point.
I have friends who are happy with their Gibson R9 custom shop re-issue despite the fact that they have 'minor' issues - including the ability to feel where the binding and wood are at different heights, some binding being ground away where the frets were rounded off in one fret, tool marks on the binding by the neck, some stain issue on the neck where it wasn't taped off properly, Some filler around an inlay that's much darker so stands out against inlay and rosewood - maybe things that you have to look closely to see and feel but these are issues on a very expensive Gibson but don't affect the function, playability and sound of the instrument and they are 'happy' because those issues don't outweigh the positives to them.
If the Indonesian factory employ a stringent QC at every stage, as well as the fact that they are only making PRS guitars and so will learn and improve by repetition. US PRS employees have gone to Indonesia to teach them how to build guitars to the standard they require so I can only see the SE line becoming more consistently great with fewer issues (minor or the major ones that PRS have to fix or scrap). That also doesn't mean that the guitars coming out of the factory are bad and we should wait until they get up to speed, up to the standard you expect. A number of SE Paul's guitars have been very favourably reviewed with no issues to complain about. Some reviews putting the SE up against the Core Paul's and how favourably it does - obviously there are some differences but bad quality isn't one of them.