Apple Inc. is actively adjusting its global manufacturing strategy in response to escalating U.S.-China trade tensions. The company aims to reduce its reliance on Chinese production by shifting a significant portion of its iPhone assembly to India. This move is driven by the imposition of high U.S. tariffs on Chinese goods, which have made Chinese-manufactured iPhones more expensive for American consumers.The Australian+14The Daily Beast+14New York Post+14Yahoo Finance+9@EconomicTimes+9Investopedia+9
Currently, approximately 80% of the 60 million iPhones sold annually in the U.S. are produced in China. Apple plans to relocate the assembly of all U.S.-bound iPhones to India by the end of 2026. This transition involves expanding existing facilities operated by partners like Foxconn and Tata Electronics in India. A new $2.6 billion Foxconn plant in Bengaluru is set to begin assembling iPhones, including the upcoming iPhone 16 and 16e models. Additionally, a Tata Electronics facility in Hosur has commenced production of older iPhone models .New York Post+1Al Jazeera+1Al Jazeera+1Financial Times+1Wikipedia+6Financial Times+6Business Standard+6Reuters+2Business Standard+2The US Sun+2
Despite these efforts, Apple faces challenges in meeting the U.S. demand solely through Indian manufacturing. India’s production capacity is currently limited, and high-end models like the iPhone Pro and Pro Max are still predominantly assembled in China due to India’s infrastructure constraints .The US Sun+16Financial Times+16Investopedia+16New York Post
In a related development, former President Donald Trump has publicly urged Apple CEO Tim Cook to halt the expansion of iPhone production in India and instead focus on increasing manufacturing within the United States. Trump emphasized that India is already performing well economically and that Apple should prioritize domestic production . This request comes amid a temporary 90-day pause in U.S.-China tariffs, which has led Apple to reassess its production strategies. The company is reviewing its plans to scale up iPhone production in India specifically for the U.S. market, considering the potential reduction in tariff pressures .Yahoo Finance+6New York Post+6Business Insider+6@EconomicTimes@EconomicTimes+4Yahoo Finance+4New York Post+4The Times of India
Apple’s diversification strategy, known as the “China Plus One” approach, also includes expanding production in Vietnam. This strategy aims to mitigate risks associated with geopolitical tensions and trade disputes. However, replicating China’s manufacturing scale and efficiency in other countries remains a significant challenge .The US Sun+2TRADLINX Blogs+2The Times of India+2The Guardian+1Supply Chain World magazine+1New York Post+12Supply Chain World magazine+12Al Jazeera+12
The ongoing trade tensions and tariff policies continue to impact Apple’s supply chain decisions. The company is balancing the need to reduce dependence on China with the practicalities of establishing alternative manufacturing hubs that can meet global demand efficiently.TRADLINX Blogs+3Supply Chain World magazine+3The Times of India+3
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