Apple's Bold Move to India

Apple is set to relocate the assembly of all iPhones destined for the US market to India by 2025, a strategic decision highlighted in a recent Financial Times report. This shift is part of Apple's broader strategy to reduce its reliance on Chinese manufacturing amidst escalating US-China trade tensions.

Why It Matters: The US, being Apple's most significant market, accounted for approximately 28% of global iPhone shipments in 2024. This move not only aims to circumvent potential tariffs but also mitigates geopolitical risks associated with US-China relations.

India's Rising Role in Apple's Supply Chain

India has emerged as a key player in Apple's manufacturing strategy, with $22 billion worth of iPhones assembled there in the fiscal year ending March 2025. This marks a 60% increase from the previous year, with about 20% of global iPhone production now originating from India.

The Big Picture: Apple's urgency to diversify its supply chain was underscored by a $700 billion market value loss due to Trump's tariffs in early 2024. The company's rapid response includes leveraging India's production-linked incentives and exploring new subsidy plans to bolster local manufacturing.

Challenges and Opportunities Ahead

Despite the progress, Apple faces hurdles in completely shifting its supply chain away from China, especially given its dependence on Chinese suppliers for components. Experts suggest that relocating just 10% of production could take up to eight years.

What’s Next: Apple's upcoming earnings report is anticipated to shed light on the financial implications of these strategic shifts and the feasibility of its 2025 production targets in India.