Apple may say that most iPhones sold in the U.S. are now assembled in India, but that doesn’t necessarily mean Apple has reduced its reliance on China. Patrick McGee, who literally wrote the book on Apple in China, explains.
For the last two quarters, Apple CEO Tim Cook has noted that iPhones sold in the U.S. are sourced from India. The move, of course, allows Apple to avoid those pesky Trump tariffs on products exported from China and sold in the United States.
Responding to a technically true but contextually misleading chart about iPhone sourcing, McGee explains why we shouldn’t start thinking of India as the new China when it comes to iPhone production beyond final assembly.
In short, it really comes down to assembly, which takes place in India, but that’s merely a workaround to the tariff problem for Apple. McGee writes:
But these iPhones are as dependent on the China-centric supply chain as every iPhone you’ve ever held. The depth and breadth of the supply chain hasn’t moved. Maybe, and hopefully, it will, but that would take years, cost tens of billions of dollars, and cause Apple unwanted friction with Beijing and Chinese consumers.
So yes, India is the “source,” but only after 1,000 parts (per iPhone) have been machined, fabricated, laser-welded, molded, shaped, etched, and fitted across an enormously complex, efficient and expensive web of factories in China involving up to 3mn workers per year. After subassembly, it’s exported to India, for final assembly and packaging, a process involving tens of thousands of workers.
De-risking is in the future. At present, India-“made” iPhones are about avoiding Modi’s tariffs on China (for the Indian market) and avoiding Trump’s tariffs on China (for the US market).
The workaround has, well, worked out for now, it seems. However, the possibility of tariffs on products exported from India to the United States remains a risk. Just today, President Trump announced on social media that the U.S. would raise tariffs on India over another issue. In response, India has called the proposed tariffs “unjustified and unreasonable.”
Meanwhile, Apple is expected to raise the base price for several iPhone 17 models when the new lineup is unveiled next month.
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