As Apple Faces Pressure After Trump Told Tim Cook To Avoid Manufacturing In India, Expert Warns iPhone Maker's 'Value-Added Growth Is In Danger'
Apple Inc. faces a manufacturing challenge as President Trump advised CEO Tim Cook against building in India, citing high tariffs. Experts warn that the U.S.-China trade reset could hinder Apple's growth plans, with manufacturing potentially shifting back to China. While Apple aims to increase iPhone production in India, competition from countries like Vietnam and Thailand poses additional challenges. Analysts suggest that despite plans for significant production in India, tariff negotiations may lead Apple to revert to a China-centric strategy.
Apple Inc. AAPL confronts a strategic manufacturing dilemma as President Donald Trump directly told CEO Tim Cook to avoid building in India.
What Happened: While Apple ramps up iPhone production in India, experts warn that the recent U.S.-China trade reset could derail Delhi's factory ambitions and threaten Apple's long-term value-added growth plans, reported the BBC.
Trump revealed during a Qatar news conference that he told Cook, “Tim, you’re my friend, we treated you very good… but now I hear you’re building all over India. I don’t want you building in India.” The president criticized India as “one of the highest tariff nations in the world” and noted it’s “very hard to sell into India.”
Ajay Srivastava of Delhi’s Global Trade Research Institute warns that “India’s low-cost assembly lines may survive, but value-added growth is in danger” as manufacturing investment could “stall” or “head back” to China.
Meanwhile, other Asian competitors like Vietnam, Thailand, Cambodia, and Malaysia — with simpler tax regimes and lower tariffs, continue to attract export manufacturing, underscoring India’s challenge in retaining relocated supply chains.
The expert notes Apple earns over $450 per iPhone sold in the U.S. while India retains less than $25, despite the full $1,000 counting as an Indian export, the report noted.
Why It Matters: Cook confirmed during Apple’s recent earnings call that the company expects “the majority of iPhones sold in the U.S. will have India as their country of origin” for the June quarter. However, the U.S.-China trade reset, which dropped tariffs from 145% to 30% versus 27% for India, threatens to redirect manufacturing investment back to China.
Wedbush analyst Dan Ives anticipates Apple could increase iPhone assembly production in India to 60%-65% by fall in a best-case scenario, but could “easily pivot back to a China-driven iPhone strategy” depending on tariff negotiations. Trump separately revealed Cook plans to boost U.S. investment to $500 billion, including AI server assembly in Houston.
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