Apple Still Cannot Escape China’s Grasp, As Veteran Reporter States That iPhones Made In India And Sold In The U.S. Are Still Dependent On The Decades-Old Supply Chain; Will Cause Company ‘Unwanted Friction’

To force iPhone production out of China, Apple has expanded its assembling facilities in regions like India, with a recent report stating that various models sold in the United States originate from the latter. However, those claims can be misleading, as a reporter states that irrespective of whether iPhones come out of a factory stationed in India, the underlying supply chain continues to depend on China and will probably take years and billions of dollars to completely transition.

Reporter says that India might be the source of these iPhones, but only after thousands of miniature and complex components have come out of China

For Apple’s last two financial quarters, CEO Tim Cook reiterated that iPhones sold in the U.S. have come from India as the Chief Executive looks to avoid Trump’s tariffs on products exported from China. However, while Cook’s claims are factually correct, he fails to point out a crucial detail that was mentioned by reporter Patrick McGee, author of ‘Apple in China: The Capture of the World’s Greatest Company.’ He says on X that iPhones are dependent on a China-centric supply chain. He also mentions that Apple’s attempts to move production out of China could cause ‘unwanted friction’ with the region and its customers.

No iPhone is really “made” in India — yet. But if the final step is completed there, it’s a “substantive” change to the product and can therefore avoid tariffs.

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).

Despite McGee pointing out the truth in his concise post, Apple has so far managed to escape Trump’s tariffs. As for the possibility that iPhone production moves to the U.S., Bloomberg’s Mark Gurman has commented earlier that no universe exists where this is a possibility because the time and money required to complete this process is tantamount to an exercise in futility.

Also, it is not like China continues to watch the show idly because a previous report mentioned that authorities were blocking an Apple supplier’s equipment from being shipped out of the country, forcing these companies to come up with ingenious tactics to move the necessary paraphernalia out without being discovered or penalized.

News Source: Patrick McGee

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