Apple(US:AAPL) Sou Hu Cai Jing·2025-06-03 14:31Core Viewpoint - Apple is under pressure from former President Trump to produce iPhones in the United States, with threats of a 25% tariff if they do not comply [1][4][9]. Production and Manufacturing - Apple does not manufacture iPhones directly; instead, it relies on Foxconn for production [1]. - Despite Trump's previous promises in 2016 to bring production back to the U.S., Apple has not moved its production lines back and has instead shifted to countries like India, Vietnam, and Thailand [2][3]. - Currently, 80% of iPhones are produced in China, and Apple has no plans to manufacture any products in the U.S. [3]. Economic Considerations - Producing iPhones in the U.S. would significantly increase costs, potentially raising the price of an iPhone to over $2000 [7]. - The cost of tariffs (25%) is minor compared to the overall production costs associated with relocating manufacturing to the U.S. [9][10]. - The investment required for U.S. production would be difficult to recoup, especially as the smartphone market evolves [12][13]. Labor and Supply Chain - The U.S. lacks the necessary skilled labor and supply chain infrastructure that China offers, making it impractical for Apple to shift production [18]. - China provides a vast labor pool and a dense supply chain, which are critical for the assembly of iPhones [18]. - Apple has previously attempted U.S. production but faced challenges, such as sourcing components like screws, which are readily available in China [14][15]. Strategic Shifts - Apple is gradually increasing production capacity in India while still relying heavily on China for complex components [20]. - The assembly process in India involves completing the final steps of production, but most components are still sourced from China [20][22]. - Trump's vision of revitalizing U.S. manufacturing for Apple is seen as unrealistic given the current market conditions [22].