Apple to Move All US iPhone Assembly to India: What This Means for Tariffs and Consumers

Apple might move the entire production of its iPhones for the US market—around 60 million units annually—to India by the end of 2026, according to a recent report from the Financial Times. This shift comes as the US has imposed significant tariffs on Chinese products, making Apple’s heavy reliance on Chinese assembly risky.

Historically, Apple has manufactured most of its iPhones in China, which has exposed it to risks from the ongoing trade conflict between the US and China. The tariffs could lead to higher prices for Apple’s flagship product. By relocating assembly operations to India, Apple could reduce the financial strain caused by these tariffs, although India may also face new trade barriers.

Interestingly, Apple has already started assembling some iPhones in India, boosting its inventory before any tariffs took effect.

Looking at the big picture, industry experts suggest that Apple’s shift is part of a broader strategy to diversify its manufacturing. Angelo Zino from CFRA Research believes this move signals a long-term plan. He stated, “Apple must think long-term with manufacturing capacity,” predicting that India could become a key player in Apple’s production strategy. Despite this shift, China is expected to remain crucial, contributing about 15% of Apple’s sales.

Apple likely won’t move all iPhone production to the US due to high costs. However, there is potential for increasing the manufacturing of semiconductors in the United States, particularly with partners like Taiwan Semiconductor. This could create more jobs domestically, an appealing prospect for the Trump administration.

Muzammil Hassan from Quandary Peak Research argues that Apple’s move to bolster manufacturing in India was already in motion before the tariffs were introduced. He states, “I don’t think it’s a temporary move.” Foxconn has been preparing for this change by training a large workforce in India. Some reports even suggest that future iPhones, like the iPhone 17, might be developed and produced solely in India.

It’s worth noting that Apple is not the first mover in this space. Other smartphone manufacturers like Samsung and Google have already set up significant production capabilities in India, with Google looking to shift its Pixel phone production from Vietnam to India as well.

As Apple navigates these changes, it reflects a larger trend of tech companies seeking to diversify their production locations to mitigate risks associated with global trade dynamics. The success of this strategy will depend on India’s ability to provide a robust manufacturing environment that meets Apple’s quality standards.



Source link