Will Donald Trump force Apple to move iPhone manufacturing to US?
Apple is mulling moving production of the smartphone to the United States, according to the Nikkei Asian Review.
Apple is reportedly asking its manufacturing partners to investigate moving iPhone production to the United States.
A Key Apple assembler Foxconn Technology Group, has been studying the possibility of moving iPhone production to the U.S.
President-elect Donald Trump had said he wants Apple to start making its “damn computers and things” in the U.S. and it is likely that his wish may get fulfilled soon.
According to the report by Nikkei, Apple has approached Foxconn and Pegatron, the two manufacturing companies that are largely responsible for assembling iPhones. “Foxconn complied, while Pegatron declined to formulate such a plan due to cost concerns,” said the report.
Foxconn, based in Taipei, manufactures more than 200 million iPhones annually from their massive Chinese campuses. Apple is the biggest customer for Foxconn that accounts for more than 50% of its sales. It is said that Foxconn’s chairman had been less enthusiastic due to an inevitable rise in production costs.
The company believes that making iPhones in the U.S. means the cost will more than double. Sources have said that U.S. President-elect Donald Trump may push the Cupertino, California-based tech titan to make a certain number of iPhone components at home. Trump had also said that he would slap a 45 percent import tariff on Chinese goods.
Apple had said the barrier to moving iPhone production to the U.S. is expertise, in addition to cost.
It costs about $225 for Apple to make an iPhone 7 with a 32GB memory, while the unsubsidized price for such a handset is $649, according to research company IHS Markit. Market experts say that manufacturing the iPhones abroad allows Apple to maintain a strong margin on its product.