In another example of politicians not knowing what they’re talking about it comes to the tech industry, Peter Navarro, trade advisor to the Trump administration, criticized Apple for not manufacturing the iPhone in the U.S.
He accused CEO Tim Cook personally of dragging his feet on the project. “Going back to the first Trump term, Tim Cook has continually asked for more time in order to move his factories out of China,” Navarro said in an interview on CNBC’s “Squawk on the Street.”
“With all these new advanced manufacturing techniques and the way things are moving with AI and things like that, it’s inconceivable to me that Tim Cook could not produce his iPhones elsewhere around the world and in this country,” Navarro said.
According to various pundits, if iPhones were made in the US instead of China, they would likely be significantly more expensive, potentially costing over US$3,000, due to the higher cost of labor and establishing a new supply chain domestically. While some components are already sourced from the US, such as Corning’s Gorilla Glass, the infrastructure and workforce needed to assemble iPhones on a large scale in the US aren’t currently in place.
As reported by CNBC, one analyst estimates that on labor costs alone, an iPhone made in the U.S. could cost 25% more than it does now. Another analyst pegged the price of a U.S.-made iPhone at $3,500.
Defending its “reciprocal tariffs,” the White House on May 23 President Donald Trump believes the U.S. has the workforce and the resources to build iPhones in the U.S. Sadly, our President is clueless about this (as well as many other things).
Should Apple be working to move more of its manufacturing processes to this country? Of course. But that’s going to be a long, slow process.
Bank of America analysts say that moving iPhone production from China to the U.S. could increase manufacturing costs by up to 90%, reports Bloomberg (a subscription is required to read the article).
Such a move is technically possible. However, Bank of America analysts say it would drastically increase production costs and result in logistical complications.
“iPhone cost can increase 25% purely on higher labor cost in the U.S.,” the Bank of America analysts told clients. They said even if Apple finds domestic workers for final assembly, a “significant portion” of iPhone components would still need to be manufactured in China and imported to the U.S.
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