Apple Confirms: “Majority of iPhones to be sold in the US will have India as their country of origin”

Apple Confirms India to be Key iPhone suppliers for US Market

Apple CEO Tim Cook confirmed a major change in the company's manufacturing strategy. He stated that India will soon be the main source for most iPhones sold in the US this quarter. This move shows Apple is intentionally changing its supply routes. The company is reducing its dependence on China. This shift is partly due to political issues and possible trade tariff concerns.

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Supply Chain Diversification amid US Tariffs Policy

Speaking to CNBC following Apple's Q2 FY25 earnings report (quarter ending March 2025), Cook explicitly addressed the geographical source of US-bound iPhones. His confirmation indicates an accelerated reliance on Indian manufacturing facilities to serve the American market. This shift is widely interpreted as a strategic measure to mitigate risks associated with potential US tariffs, particularly the steep 145% levy currently applicable to imports from China under the Trump administration's reciprocal trade policy.

While India takes on a larger role for iPhones, Cook indicated that Vietnam would handle most production destined for the US market for other key products like iPads, Macs, Apple Watches, and AirPods. These countries currently face lower baseline tariffs compared to China. However, Cook cautioned about the fluidity of the situation, stating, "It’s very difficult to predict beyond June," acknowledging ongoing uncertainty in the global trade landscape.

Apple appears to be proactively managing the financial implications of these shifts and potential tariffs. The company budgeted approximately $900 million in additional costs for the current quarter, citing tariffs as a significant factor – a figure some analysts found lower than anticipated. Despite the production shift for iPhones, accessories and AppleCare services sourced from China will still face the full 145% tariff, a cost Apple seems prepared to absorb currently. Cook also noted there was "no obvious evidence" yet of consumers altering purchasing behaviour in anticipation of future price increases potentially linked to tariffs. Apple reported strong quarterly revenue of $95.4 billion, up from $90.75 billion the previous year.

Tim Cook's confirmation solidifies India's rapidly growing importance within Apple's global manufacturing strategy, moving beyond serving the domestic market to becoming a primary production hub for iPhones destined for the US. This strategic pivot, driven significantly by the need to navigate potential US tariffs and diversify away from China, underscores India's emergence as a critical node in the global technology supply chain, although the longer-term manufacturing distribution remains subject to evolving trade dynamics.