Apple Migrating iPhone Supply Chain From China to India

Apple is preparing to make a major change to its supply chain, with the company reportedly moving to manufacture all US-bound iPhones from India instead of China.
Apple Migrating iPhone Supply Chain From China to India
Written by Matt Milano

Apple is preparing to make a major change to its supply chain, with the company reportedly moving to manufacture all US-bound iPhones from India instead of China.

Apple’s supply chain has relied on factories and suppliers in China for years, but the Trump administration’s trade war with China has put the iPhone maker in a difficult position. As a result, according to the Financial Times, via The Guardian, Apple is looking to move its manufacturing for US-bound iPhones to India entirely.

While the Trump administration has levied “reciprocal tariffs” on virtually every country, including India, the tariffs against China are the highest by far. To make matters worse, the two countries appear to be deadlocked, with neither willing to take the first step toward positive negotiations.

The Trump administration has been pushing US companies to revitalize American manufacturing and bring their manufacturing operations State-side. Apple’s decision to rebase its supply chain in India, rather than the US, underscores the challenges involved in manufacturing sophisticated electronics in the US. It’s not a matter of manufacturing one or two components domestically.

Electronics manufacturing requires on an entire ecosystem of companies and suppliers that can provide the hundreds of difference components that go into a smartphone, tablet, or computer. Even if Apple could rely on US factories to assemble its products, the supporting suppliers no longer exist domestically, meaning the company would still have to source many of the components from overseas. The only difference would be a higher cost for the final product, since it would cost more to assemble it piecemeal, as opposed to in once central location where the bulk of the necessary components are available.

Moving its supply chain to India will hopefully allow Apple to keep prices from jumping too much.

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