Apple Shifts Majority of US iPhone Production to India Amid Tariff Pressures

Apple is set to source nearly its entire line of iPhones sold in the United States from assembly facilities in India, according to CEO Tim Cook. This move, expected to affect about 60 million phones annually, is a strategic response to the Trump administration’s imposition of tariffs on Chinese imports, which can reach up to 145%.

Cook revealed during Apple’s Q1 earnings call that for the June quarter, the majority of iPhones sold in the US will have India as their country of origin. Meanwhile, Vietnam will be the production base for nearly all iPads, Macs, Apple Watches, and AirPods sold in the US. This diversification helps Apple avoid the significant cost pressures from tariffs on Chinese goods.

Historically, Apple’s iPhone production has been heavily concentrated in China, making the company vulnerable to trade tensions between the US and China. The tariffs have raised concerns about potential price increases for Apple’s flagship product. By shifting assembly to India, Apple aims to mitigate these risks, although India itself has introduced tariffs that could affect costs.

Industry analysts view this move as part of a broader, long-term strategy to diversify manufacturing capacity. Angelo Zino, a senior vice president at CFRA Research, expects Apple to potentially double its iPhone production capacity in India over the next two to three years. Despite this, China will remain a significant manufacturing hub, especially for sales outside the US, which constitute a large portion of Apple’s global market.

Apple is unlikely to move all production to the US due to high costs but may increase US-based manufacturing of key components such as modems and processors through partnerships with companies like Taiwan Semiconductor. This aligns with the Trump administration’s focus on domestic technology value creation rather than device assembly.

Experts note that Apple’s shift to India was underway before tariffs were imposed. Foxconn, Apple’s key assembler, has been training thousands of workers in Tamil Nadu, India, and reports suggest future iPhone models might be developed and manufactured exclusively in India. This indicates a durable, not temporary, transition.

Apple is not alone in this trend; other major smartphone manufacturers such as Samsung, Oppo, Vivo, and Motorola have already established production in India. Additionally, Google is reportedly shifting Pixel phone production from Vietnam to India, underscoring India’s growing role as a global manufacturing hub.

Broader Implications for Tech Manufacturing

Apple’s strategic pivot highlights the increasing importance of manufacturing diversification in the face of geopolitical risks. Companies are reevaluating their supply chains to reduce dependency on any single country, particularly amid rising tariffs and trade uncertainties. India’s emergence as a key assembly hub offers cost advantages and access to a large, skilled workforce, positioning it as a vital player in the global technology supply chain.

For technology leaders and businesses, understanding these shifts is critical for strategic planning and risk management. Diversifying production locations can help mitigate tariff impacts, maintain competitive pricing, and ensure supply chain resilience. Apple’s move serves as a case study in adapting to evolving global trade dynamics while sustaining innovation and market leadership.