Commercial tension between the US and China is on the rise again. Recently, the US administration announced that it will apply 54 percent additional customs tariffs to Chinese products. This decision directly affects global technology giants that produce Chinese -based production. Apple is one of these companies.
According to Wall Street Journal based on anonymous resources; Apple plans to respond to this development with India production in the short term. The company does not want to change the supply chain of China immediately. However, rising costs force Apple to look for alternative ways. At this point, India production becomes a temporary exit gate.
Apple plans to escape from additional taxes by directing Indian production iPhones to the USA
The new tariff of the United States to China is 54 percent. On the other hand, the ratio offered for products from India is 26 percent. The difference between Apple offers a serious cost advantage. For this reason, the company’s possibility of importing India -produced iPhones to the United States is strengthening.
For example, an iPhone 16 Pro with an import cost of $ 550 can cost about $ 850 with Chinese tariffs. This means an additional cost of $ 300 per product. For a high -volume sales company like Apple, this difference has an additional load of billions of dollars. Therefore, the Indian option is no longer only alternative, it becomes almost compulsory.
According to Bank of America analyst Wamsi Mohan, Apple is preparing to produce 25 million iPhones in India this year. 10 million of this production is expected to be separated for the Indian market. The remaining 15 million devices will be directed to global markets. If all is exported to the United States, this number is to meet about half of the iPhone demand within the country.
Apple’s production capacity in India is increasing every year. The investments of production partners such as Foxconn and Pegatron in the region further expand this capacity. In addition, the incentives offered by the Indian government to foreign investors facilitate Apple’s decision to diversify the production base. In addition to all these, India’s young and growing users also offer a remarkable market.
The company has recently increased the number of models produced in India. Especially models such as iPhone SE and iPhone 15 are produced in this country and sent to different markets. This production model provides flexibility not only in cost, but also in terms of logistics. Moreover, local employment and tax advantages become attractive for Apple.
Apple’s Chinese -based production chain still has great weight. Nevertheless, the company saw the importance of geographical diversity more clearly with the supply problems experienced after the pandemi. India stands out as the first stop of this diversity. Both production capacity and political stability support this choice.
This development seems to affect not only Apple, but also other technology manufacturers. Similarly, companies like Samsung and Google increase production investments in India. Global changing production balances can reshape the map of the world of technology in the coming period. Apple’s orientation can be considered as one of the early signs of this change.