Apple Shifts U.S.-Bound Production from China to India and Vietnam Amid Tariff Pressures
Apple has announced a major shift in its production strategy, moving much of its manufacturing for U.S.-bound products out of China — a change driven by the impact of U.S. tariffs under President Donald Trump's trade policies.
According to CEO Tim Cook, the majority of iPhones destined for the U.S. will soon be made in India, while Vietnam will take the lead in producing Apple Watches, iPads, and other key devices. This strategic pivot comes as Apple estimates that U.S. import tariffs could increase its costs by around $900 million this quarter, despite certain electronic products being exempted from the new duties.
While the Trump administration has pushed for Apple to bring production to the U.S., the tech giant is instead expanding its footprint in other countries. On a recent earnings call, Cook emphasized Apple's commitment to investing $500 billion in the U.S. over the next four years, but highlighted the necessity of diversifying its supply chain in the face of trade tensions.
India and Vietnam are now positioned as major manufacturing hubs. “We expect most iPhones sold in the U.S. to originate from India,” said Cook, adding that Vietnam will become the primary production base for nearly all iPads, MacBooks, AirPods, and Apple Watches sold in the U.S.
Despite the relocation plans, Cook confirmed that China will remain the manufacturing center for Apple products sold outside the U.S. However, the transition to new production bases will be costly and time-intensive, requiring billions of dollars in investment.
Shanti Kelemen, CIO at M&G Wealth, told the BBC that while Apple is moving forward, challenges remain: "There will still be tariffs impacting supply chains and costs associated with building new factories."
Apple’s stock took a hit following Trump's tariff announcement, but the administration later excluded some electronics from the tariffs under pressure from industry stakeholders.
So far, Apple’s sales have remained strong despite trade tensions, with revenue for the most recent quarter rising 5% year-over-year to $95.4 billion.
Found this article interesting? Follow us on X(Twitter) ,Threads and FaceBook to read more exclusive content we post.
