US President Donald Trump recently told a gathering of US governors that Apple CEO Tim Cook was planning to move manufacturing from Mexico to the US, Bloomberg reported. Notably, Cook or Apple have not yet publicly announced the move, but Trump claims that the Apple CEO has ” stopped two plants in Mexico” and will build products in the US.
Trump’s announcement comes just a day after he met with Apple‘s top executive, where he said Cook promised hundreds of millions of dollars in investment in the US.
After the meeting with Cook, Trump told reporters on Friday, “He’s going to start building,”
“Very big numbers — you have to speak to him. I assume they’re going to announce it at some point.” the US President added.
While it isn’t clear which Apple plant exactly President Trump pushed Cook into closing but the Bloomberg report suggests that it could be a Foxconn manufacturing facility. Reportedly, Apple doesn’t rely heavily on Mexico for its production and used its suppliers to make some parts but most of the manufacturing happens in Asia.
Since his win in the US Elections last year, Cook has looked to strengthen his relationship with President Trump first by travelling to meet him at his residence Mar-a-Lago in Florida during the transition period and later during the President’s inauguration in January.
During the first Trump administration, Cook was to able to use his relationship with the US President to get tariff exemptions for iPHones. However, Trump has suggested that he is looking to avoid exemptions as he looks to impose sweeping new tariffs on imported goods.
Apple’s India push:
While Apple still relies majorly on China for its iPhone production, the Cupertino based tech giant is increasingly looking to reduce its reliance on the Asian country with India as an alternate. Apple started assembling its full iPhone 16 series in India last year and also added that it will assemble the latest iPhone 16e variant in the country.
Apple also makes around 15 percent of its iPhones in India and this number is expected to rise to around 25 percent by 2027, according to JPMorgan and Bank of America analysts quoted by Financial Times.
While the reciprocal tariffs imposed by Trump will also impact India, it isn’t yet clear if they will hinder with the iPhone manufacturing in the country.
Impact on tariffs on iPhones:
According to a Bank of America analysis (via CNBC), Apple will need to hike its prices by around 9% in order to mitigate the impact of tariffs imposed by President Trump. The analysis assumes that there will be a tariff on at least 10% on Apple products like iPHones, iPads and others.
Notably, President Trump signed a memorandum applying ‘reciprocal tarrifs’ based on what foreign nations charge America. Countries using a VAT system, which he considers more punitive than traditional tariffs, will be treated similarly.
Apple’s shares had fallen earlier in the month when Trump announced a 10% tariff on China, the country where most of Apple products are assembled.