Former President Trump’s reasoning behind his proposed tariffs is to compel companies to manufacture goods within the US. He has pointed to Apple as an example, suggesting that the company is on track to produce iPhones domestically.
Apple has repeatedly clarified why such a move is impractical, with CEO Tim Cook articulating the challenges over a decade ago. Various analysts, supply chain specialists, and an ex-Apple engineer have supported this assertion, indicating that such a transition is not feasible and wouldn’t bring the anticipated benefits even if it were executed.
Tim Cook emphasized as early as 2015 that the era in which the US could manufacture at this large a scale has passed.
“China has placed a tremendous emphasis on manufacturing, while the US has gradually reduced its focus on vocational skills. All the tool and die makers in the country could fit in a room, whereas in China, you would require multiple football fields.”
The most feasible outcome would involve “final assembly engineering,” where Apple would bring near-finished iPhones to the US for minor modifications, allowing them to claim domestic manufacturing. The company has previously adopted this strategy in Brazil.
Expert Insights
Several specialists have commented on the impracticality of Trump’s ambitions, highlighting the substantial financial implications involved.
Dan Ives, an analyst at Wedbush Securities, cautioned The Guardian that shifting iPhone production back to the US would pose overwhelming costs for both Apple and its consumers.
“To even relocate 10% of the supply chain from Asia to the US would require approximately three years and $30 billion,” Ives noted in a recent letter to investors. “For US consumers, the notion of a $1,000 iPhone being among the best consumer products would fade away.”
He further added that if the devices were to be produced solely in the US, the price could skyrocket to over $3,500. “If consumers desire a $3,500 iPhone, it would need to be manufactured in places like New Jersey or Texas.”
The investment bank Evercore concurs with Cook’s remarks about the impracticality of US-based assembly.
“The US economy is not structured to facilitate mobile phone assembly. There are neither the facilities nor the adaptable workforce available,” he stated. “It is simply not practical to train 200,000-300,000 individuals for iPhone assembly.”
Insights from a Former Apple Engineer
Arstechnica reported that a former Apple engineer shared a similar perspective.
Matthew Moore, a former manufacturing engineer at Apple, remarked to Bloomberg that “millions of people work within Apple’s supply chain in China,” and the company has long maintained that the US labor pool cannot easily supplement this workforce.
“Which American city would pause its operations to focus exclusively on iPhone assembly?” Moore questioned. “For instance, Boston has over 500,000 residents; the entire city would have to halt other activities to embark on iPhone production.”
Even if US assembly could be initiated, replicating Apple’s comprehensive Chinese supply chain, which consists of thousands of companies, would remain unfeasible. Consequently, the company would still need to import components and incur tariffs.
In conclusion, what Trump envisions is unattainable, and his threats are likely to prove unsubstantiated.
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