Apple in Action to Beat Tariff Pressures
Apple is moving swiftly to make India the primary production hub for iPhones sold in the United States by the end of 2026, Reuters reported, citing a source familiar with the matter. The move comes as the U.S. tech giant braces for potentially higher tariffs on goods produced in China, its main manufacturing base.
According to the report, Apple is holding urgent discussions with contract manufacturers Foxconn and Tata to achieve the transition. Both companies are already key players in Apple’s India operations. However, the planning process remains confidential, and Apple, Foxconn, and Tata declined to comment on the developments.
Apple’s Strategic Shift Away from China
Currently, around 80% of the over 60 million iPhones Apple sells annually in the U.S. are made in China. Amid escalating trade tensions, Apple has been working to diversify its manufacturing footprint. India’s strategic push under Prime Minister Narendra Modi to become a smartphone manufacturing hub has opened the door for this shift, despite higher import duties on mobile phone parts compared to many other countries.
Manufacturing costs for iPhones in India are estimated to be 5-8% higher than in China, and in some cases, the gap could widen to 10%. Yet, with growing geopolitical risks and tariff hikes, the cost differential is becoming a secondary concern for Apple.
Record Shipments from India
Apple has already started ramping up its India production to navigate the changing trade landscape. In March, it shipped approximately 600 tons of iPhones worth $2 billion from India to the U.S., a record-breaking figure for its contractors Tata and Foxconn. Foxconn alone accounted for $1.3 billion of those shipments.
Earlier in April, the U.S. government imposed 26% duties on imports from India, much lower than the over 100% duties imposed on Chinese imports. Although Washington has since paused most duties for three months—except for China—the pressure to diversify production remains.
India’s Growing Importance
With three factories already operating and two more under construction, Foxconn and Tata are poised to expand their roles in Apple’s global supply chain. The Financial Times was the first to report on Apple’s accelerated manufacturing plans.
As trade tensions show little sign of permanent resolution, Apple is betting big on India to secure its supply chain, maintain market stability, and protect its bottom line in a volatile global environment.
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