During a recent state visit to Qatar, President Donald Trump expressed his discontent over Apple’s manufacturing plans in India, discouraging CEO Tim Cook from establishing plants in the country for device production aimed at the U.S. market.
Trump recounted a conversation with Cook, stating, “I had a little problem with Tim Cook yesterday. He is building all over India. I don’t want you building in India.” Following their dialogue, Trump indicated that Apple could increase its production within the United States.
Representatives from Apple in India did not respond to requests for comment regarding the discussion.
The president’s remarks complicate Apple’s strategy to manufacture a significant portion of the iPhones sold in the U.S. from India by the end of next year, a move aimed at diversifying its supply chain away from China amid trade tensions and tariff concerns. Currently, Apple manufactures the bulk of its iPhones in China and lacks any domestic smartphone production, although it has committed to increasing hiring and investing $500 billion in the U.S. over the next four years.
Establishing full-scale iPhone production in the U.S. poses considerable challenges, even for a financially robust company like Apple. The intricate supply chain and skilled labor essential for producing such a highly engineered product have long been centered in China. While Apple has started to build partnerships in India, the high cost of American labor and manufacturing make domestic production a daunting prospect. Conversely, India represents one of Apple’s most rapidly expanding markets, boasting a large consumer base eager to purchase its products. Additionally, the Indian government offers state subsidies to facilitate assembly growth.
“This is a familiar Trump tactic: He wants to push Apple to localize more and build a supply chain in the U.S., which is not going to happen overnight,” explained Tarun Pathak, research director at Counterpoint. “Manufacturing in the U.S. will also incur significantly higher costs than assembling iPhones in India.”
Apple and its supply chain partners have increasingly moved away from relying on China, a transition that began following severe Covid-19 restrictions that impacted operations. Tariffs implemented during Trump’s administration and rising tensions between Washington and Beijing further accelerated this shift.
Apple’s assembly facilities in India currently produce over 40 million units annually, accounting for approximately 20 percent of the company’s global output. Although Trump has advocated for increased iPhone manufacturing in the U.S., the lack of available engineering and manufacturing talent poses significant challenges.
“Apple has cultivated one of the most sophisticated supply chains over many years,” Pathak remarked. “To disrupt that or completely relocate operations away from India or China will be extremely difficult.”
Trump’s statements indicated that he is amenable to Apple’s operations in India for the local market. “You can build in India if you want, to take care of India,” he stated.
The president also touched on tariff negotiations with India, mentioning that the country has proposed eliminating import duties on U.S. goods. India is recognized for having one of the highest tariff barriers worldwide, creating challenges for American products in the world’s most populous nation, according to Trump.
The majority of iPhones manufactured in India are assembled at Foxconn Technology Group’s factory in southern India. Tata Group’s electronics manufacturing subsidiary, which recently acquired Wistron Corp.’s local business and operates Pegatron Corp.’s facilities, is another vital supplier. Both Tata and Foxconn are expanding their operational capacities by constructing new plants in southern India, as previously reported by Bloomberg News.
In the last 12 months leading to March, Apple assembled iPhones worth $22 billion in India, marking a nearly 60 percent increase in production compared to the previous year.
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(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)
