Apple Said To Be Considering US Production After Trump Victory
Reports out of the the Nikkei Asian Review suggest that Apple may be taking Donald Trump’s demands for “Apple to build their damn computers and things in this country instead of other countries” more seriously than many expected after he triumphed in last week’s US Presidential election.
Unnamed sources told the publication that the company had spoken to its Chinese manufacturing partners Foxconn and Pegatron to explore the possibility moving iPhone manufacturing to the U.S.
During his campaign, the U.S. Presidential-Elect called for a 45% tariff on goods coming into the US from China.
Earlier this week, the state-run Chinese publication Global Times warned that “U.S. auto and iPhone sales in China will suffer a setback” if Trump follows through on his rhetoric.
If true, it would be a win for Trump – who has promised to bring overseas jobs back to middle America – but potentially a real problem for Apple.
The company is already facing a decline in iPhone sales and a bite into their margins like this is likely to push the handset’s price up even higher than the usual premium.
One source told NAR that that moving iPhone manufacturing back to the U.S. would more than double the cost, on a per-unit basis.
However, transplanting their production line to the United States isn’t without its challenges.
In addition, Apple’s Chief Executive Tim Cook has previously said that America simply did not have enough skilled workers for the production of iPhones.
A lack of existing infrastructure would also be a major factor.
One executive familiar with the Apple’s practices said that “Even if Trump imposes a 45% tariff, it is still possible that manufacturers will decide to continue production overseas as long as the costs together with the tariffs are lower than the amount they need to spend on building and running production lines in the U.S.”
“It is not easy to make iPhones in America, unless the U.S. government subsidizes local companies for producing domestically,” another source told the Review.