President Donald Trump has issued a stern warning to Apple, stating that the tech giant could face a tariff of at least 25% unless it shifts its iPhone manufacturing to the United States. This statement intensifies the push for increasing domestic production.
In a post on Truth Social on Friday, Trump remarked, “I have long ago informed Tim Cook of Apple that I expect their iPhones sold in the United States of America will be manufactured and built in the United States, not India, or anyplace else. If that is not the case, a Tariff of at least 25 percent must be paid by Apple to the US.”
The announcement triggered a drop in US equity futures, particularly affecting Nasdaq 100 contracts, which saw significant declines. Apple shares fell by as much as four percent during pre-market trading amid concerns over Trump’s tariff threats and his intention to impose a 50% tariff on European Union goods starting June 1.
The president’s insistence on US-based manufacturing creates considerable challenges for Apple, which has relied on China for its supply chain for many years. The infrastructure needed to support such a manufacturing shift currently does not exist in the US to the extent it does in Asia, where Apple has established a robust network of suppliers and manufacturing expertise.
Apple has not yet commented on Trump’s latest threats. Recently, the company disclosed that it anticipates an increase of $900 million in costs due to tariffs in this quarter alone.
During a recent visit to the Middle East, Trump expressed frustration with Apple’s operations in India, urging Tim Cook to halt the construction of new plants there intended for devices aimed at the US market. Trump stated, “I had a little problem with Tim Cook yesterday. He is building all over India. I don’t want you building in India.”
This year, Apple announced plans to invest $500 billion in the US over the next four years, which would include the establishment of a new server manufacturing facility in Houston, a supplier academy in Michigan, and increased spending with existing US suppliers.
However, this commitment does not align with Trump’s vision of a complete shift to US manufacturing. Transitioning production of the iPhone and other devices to the US presents a substantial challenge for the California-based company.
The largest final assembly, test, and pack-out facilities utilized by Apple are vast complexes that bear resemblance to small towns, housing hundreds of thousands of workers along with amenities like schools and medical facilities. One notable facility, located in Zhengzhou, is known colloquially as iPhone City.
While the development of new iPhones starts in Silicon Valley, the collaboration with Asian suppliers and partners occurs long before any product launches. Apple engineers invest considerable time working alongside Foxconn Technology Group, Pegatron Corp., and other suppliers to customize device assembly.
Some experts suggest that Apple could leverage its substantial cash reserves to acquire land in the US and establish a fully automated manufacturing facility. However, supply chain analysts argue that this approach is impractical due to fluctuating market demands, plus much of the essential manufacturing equipment is sourced from China.
The recent escalation of pressure on Apple contrasts with Trump’s first term, when Tim Cook managed to utilize his relationship with the president to secure tariff exemptions for Apple products. This new stance raises uncertainties for Wall Street investors regarding the impact of Trump’s trade policies on one of the world’s most valuable companies.
Randy Hare, director of equity research at Huntington National Bank, noted, “It’s a red flag for me that Trump continues to single out Apple and seems to have something against them. It doesn’t mean that Trump is going to do anything more, but you can’t predict what’s going to happen, and that makes me cautious.”
Cook was among several prominent tech executives who sought to build rapport with Trump following the latter’s election victory in November. The Apple CEO had engaged in private meetings with Trump at his Mar-a-Lago estate and was present at the inauguration alongside other tech luminaries including Elon Musk, Sundar Pichai from Google, Mark Zuckerberg of Meta Platforms, and Jeff Bezos of Amazon.com.
© Thomson Reuters 2025
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