The President of the United States, Donald Trump, recently mentioned a “minor issue” concerning Tim Cook, CEO of Apple. This followed Apple’s announcement that a significant portion of its iPhone production would shift from China to India. Trump expressed that he wasn’t particularly interested in Cook’s plans and insisted that Apple should focus on manufacturing in the US. He acknowledged the move to India but remarked that an iPhone made in India wouldn’t be suitable for the US market, emphasizing, “We don’t want you to build there… we want you to build here.”
This statement came after Cook shared, back in June, that India is set to become a primary hub for iPhone production destined for the American market, while China would cater to other regions due to tariff issues.
Advertisement – Scroll to continue
If it’s Tim Cook, the president’s “minor issues” could escalate into major complications, especially considering the challenges of transitioning iPhone manufacturing from Asia to the US.
Cost, scale, skills, infrastructure
Notably, Apple lacks production facilities within the US. Most smartphones are currently assembled in China, although India produces around 40 million units annually, accounting for about 15% of Apple’s total production.
Trump appears hopeful that Apple’s commitment to US production will strengthen local manufacturing efforts. Still, manufacturing costs, especially labor, are generally lower in both India and China compared to the US.
This isn’t merely about cost; it involves a blend of scale, skilled labor, and infrastructure. The intricate process of assembling sought-after smartphones includes over a thousand components sourced globally.
In 2004, Cook was instrumental in Apple’s shift to overseas manufacturing, which led to cost reductions and the necessary scale for producing advanced technology products.
“To manufacture Apple devices, you need a workforce skilled in operating cutting-edge machinery. In the US, you might gather a small group of tool engineers, but I doubt we could fill a room. In China, you could fill several soccer fields with qualified workers.”
Over the years, Apple has been searching for strategies to diversify its supply chain away from China, aiming to mitigate geopolitical risks and capitalize on emerging manufacturing hubs. India, alongside Vietnam, has been a key target for this strategy.
In March, Apple ramped up its production in India, airlifting a record $2 billion worth of iPhones. This move involved collaboration with Foxconn and Tata Electronics to meet increasing demand and reflects an effort to circumvent high tariffs on goods from China.
In April, Indian Union Minister Ashwini Vaishno mentioned that a significant batch of iPhones had been exported from India.
Foxconn and Tata Electronics are working together to assemble iPhones in India. Tata, a newer Apple partner, recently began operations at a new facility in Hosur, Tamil Nadu, focused on producing an older iPhone model.
Additionally, another Foxconn facility is set to open in Bengaluru, expected to be the second-largest Foxconn plant after its major site in China, creating about 40,000 direct jobs, especially for those with medium education levels.
Foxconn has also started producing Apple AirPods in Telangana for export.
“India doesn’t lose much.”
Experts suggest that if iPhone assembly is moved to the US, Apple would incur greater losses than India. “For every iPhone sold in the US for around $1,000, India’s share is less than $30,” states a think tank report, highlighting that trade data indicates $7 billion added to the US trade deficit.
Products like the iPhone, priced at $1,000, incorporate components from various countries. The actual device value is about $450, with US firms (like Qualcomm and Broadcom) profiting an additional $80. Taiwan receives $150 for chip manufacturing, while South Korea accounts for $90 for screens and memory chips. Japan contributes around $85 for camera components. Other countries, including Germany, Vietnam, and Malaysia, share about $45 of this total, according to a report from the Global Trade Research Initiative (GTRI).
“If assembly relocates, India will need to shift from basic assembly lines to more in-depth manufacturing—like chips and batteries,” a specialist noted.
While moving assembly units could create entry-level jobs in the US, it drastically increases production costs. In India, assembly workers earn about $290 per month, whereas in the US, under minimum wage laws, that cost would exceed $1,000 per month (the federal minimum wage is currently $7.25 an hour).
Deepak Shenoy, CEO of CapitalMind AMC, asserted that India might draw some lessons from Trump’s approach and should encourage local manufacturing, signaling to its manufacturers to prioritize local production over China. “I think it highlights what India should express to its manufacturers—build here, not in China. Leaders everywhere want jobs for their citizens,” he posted on X.
Why are we upset that Trump is telling Tim Cook to manufacture in the US, rather than India? This could be crucial for communicating to India to support its own manufacturers. It’s about building here, not in China.
Leaders everywhere desire opportunities for their people.
– Deepak Shenoy (@deepakshenoy) May 15, 2025
Some industry analysts caution that if the US truly begins assembling iPhones, costs could soar to around $3,000. The current market price is approximately $1,000, with elevated labor costs being a significant contributor to any price increase.
On the other hand, insiders at Apple indicate that the company has no intention of altering its investment strategy in India based on Trump’s comments.
Currently, Apple stands as a key player amid the ongoing US-China trade tensions, despite some relief for specific high-tech products like smartphones and computers. While fully assembled smartphones are exempt from tariffs, some components are still subject to duties.
Recently, the US and China reached an agreement to pause 90-day reciprocal tariffs, temporarily alleviating the trade strife that has unsettled markets.
Before this deal, Cook mentioned that Apple’s ability to gauge the ramifications of tariffs is quite limited.
“Work won’t come back”: Steve Jobs
Trump is not the first president to push for the return of manufacturing jobs to the US. Back in 2011, Barack Obama inquired during a private meeting with Steve Jobs, the former Apple CEO, about the requirements for assembling an iPhone in America.
Jobs famously replied, “These jobs won’t come back.”
Years later, experts agree that the US still lacks the necessary supply chain and skillset required for electronics manufacturing.
The founder of Viahart, a toy company, noted numerous challenges in a blog, explaining that building iPhones hinges on established factories in Asia for essential components.
“The supply chain appears complex, but it’s rather straightforward. If accessible components can’t be procured at reasonable prices and timelines, tariffs become irrelevant because local assembly wouldn’t be viable. It leads to the need for imports.”
