Apple moves iPhone production to India

Published: 2025-05-02 14:01:08 ET AAPL

Published on 05/02/2025 at 14:01

Key takeaways

Apple is making a major shift in its iPhone manufacturing strategy. Most iPhones destined for the U.S. market will now be manufactured in India, while Vietnam is emerging as a major hub for products such as iPads and Apple Watches. The decision comes in response to rising trade tensions and possible tariffs imposed by the Trump administration.

While President Trump has encouraged companies like Apple to bring manufacturing back to the United States, Apple is instead investing heavily in alternative manufacturing locations. CEO Tim Cook highlighted Apple's commitment to invest $500 billion in several U.S. states over the next four years. The move is intended to mitigate the impact of potential tariffs while diversifying Apple's supply chain.

The impact of tariffs on technology companies

The shift away from China will take place step by step and involves significant investment and time. Experts argue that despite Apple's efforts, tariffs could still play a role in supply chains, potentially leading to higher costs. Nevertheless, Apple achieved strong financial results, with first-quarter revenue up 5 percent from the previous year, reaching $95.4 billion.

Amazon, another tech giant that may face possible tariffs, also saw its North American e-commerce sales rise 8 percent from a year earlier. Both companies expressed confidence in their ability to navigate challenging market conditions. Andy Jassy, CEO of Amazon, believes the company's size and position as a supplier of essential goods will allow it to weather any storms.

The shift of iPhone production to India has been praised by industry analysts and represents a significant change from Apple's previous stance that only China had the capacity to produce iPhones. Although progress still needs to be made, this move is a promising step in diversifying Apple's manufacturing base.

Both Apple and Amazon are actively adjusting their strategies to minimize the impact of potential import duties. They are focusing on building diverse supplier networks and strengthening their overall resilience in the face of global trade uncertainty.

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