Apple Inc. (NASDAQ: AAPL) is planning to move the assembly of all iPhones sold in the United States to India as early as next year. This decision comes in response to escalating trade tensions between the U.S. and China, according to a report by the Financial Times.
The company’s shift away from China will likely happen sooner and more extensively than expected. Apple aims to source all 60 million iPhones sold annually in the U.S. from India by the end of 2026. This ambitious target means India’s iPhone production will need to double within a little more than a year—a much faster pace compared to the nearly two decades Apple spent establishing its manufacturing presence in China.
Apple has long relied on China as a manufacturing hub, producing many of its products through third-party suppliers like Foxconn. However, this dependence exposes the company to significant risks from the trade tariffs imposed by the U.S. against China. The situation worsened earlier this year after U.S. President Donald Trump reignited the trade war with China. While Trump exempted electronics imports from tariffs for a brief period, he made it clear that this exemption would be temporary and that tariffs on electronics would be imposed separately.
Trump imposed tariffs as high as 145% on Chinese imports, prompting a retaliatory 125% tariff from China. These developments raised concerns about Apple’s vulnerability, wiping out up to $700 billion from the company’s market value.
In response, Apple has been expanding its production capacity in India with the help of contract manufacturers such as Tata Electronics and Foxconn. This shift accelerated after Apple experienced production disruptions in China, which were linked to civil unrest. Despite these efforts, Apple still manufactures the majority of its flagship iPhones in China, though its production footprint in India continues to grow as part of a broader strategy to diversify its manufacturing base.
The move to India marks a significant step in Apple’s efforts to navigate the ongoing geopolitical tensions between the U.S. and China.
Related topics:
