In a bid to avoid US tariffs, Apple has chartered cargo flights to ferry iPhones from India to the US, amid escalating trade tensions between Washington and Beijing.
Apple‘s Desperate Measure: Flying iPhones from India to Avoid Trump Tariffs
In an effort to mitigate the impact of Donald Trump‘s tariffs, ‘we’re going to do something that’s never been done before’ , Apple has reportedly chartered cargo flights to ferry iPhones from its Indian manufacturing plants to the US. This move is part of a larger strategy by the tech giant to ramp up production in India and reduce its reliance on Chinese suppliers.
Apple's iPhone importation strategy involves a complex process of manufacturing, sourcing, and logistics.
The company partners with suppliers in China to design and manufacture the majority of its iPhones.
These components are then shipped to other countries for final assembly and quality control before being imported into the US market.
According to data from 2020, over 70% of Apple's iPhone exports originated from China.
This strategy allows Apple to take advantage of low labor costs and streamlined supply chains in Asia while maintaining control over its products' design and quality.
The Backstory: Trump‘s Tariffs and Their Impact
Trump‘s threatened tariffs on Indian imports are currently on hold, but he has announced that tariffs on goods from China – where Apple assembles most of its iPhones – will be subject to a levy of at least 145%. ‘The tariffs are going to come’ , this move is expected to have a significant impact on the global tech industry, with analysts warning that iPhone prices could surge.
President Donald Trump introduced tariffs on imported goods to protect American industries and create jobs.
The tariffs, which affect various countries including China, Canada, and the European Union, range from 10% to 25%.
According to the US Census Bureau, tariffs collected in 2020 reached $63 billion.
However, many businesses and economists argue that tariffs lead to higher prices for consumers and reduce international trade.
The 'World Trade Organization' (WTO) has also criticized Trump's tariffs as a form of protectionism.
Apple‘s Plan: Flying iPhones from India
According to Reuters, Apple has flown 600 tonnes of iPhones, or as many as 1.5m handsets, to the US from India since March. This is part of a larger effort by the company to increase production at its Indian factories and reduce its reliance on Chinese suppliers. The move is seen as a desperate measure to avoid the tariffs imposed by Trump.
The Chennai plant produced 20m iPhones last year, including the latest iPhone 15 and 16 models. Apple has three plants in India operated by Foxconn and Tata. The company’s plan to increase production at these plants has been met with skepticism by some analysts, who warn that moving iPhone production to the US would be prohibitively expensive.
The Cost: A $3,500 iPhone?
Analysts have warned that a US-made iPhone would cost $3,500, making it inaccessible to many consumers. ‘It’s going to be very difficult for people to afford’ , this has led one analyst to suggest that Apple should make iPhones in other states, such as New Jersey or Texas, if consumers are willing to pay such high prices.
As the situation continues to unfold, one thing is clear: Apple‘s decision to fly iPhones from India to avoid Trump tariffs is a significant move that could have far-reaching consequences for the tech industry and consumers alike.
Apple's decision-making process is a closely guarded secret, but it's known to involve a team of experienced executives and engineers.
The company's co-founder, Steve Jobs, was instrumental in shaping the brand's product development strategy.
Today, Apple's decisions are driven by a focus on innovation, user experience, and sustainability.
The company invests heavily in research and development, with a significant portion of its annual revenue allocated to R&D.
This approach has enabled Apple to stay ahead of the competition and maintain its position as a leader in the tech industry.
- theguardian.com | Apple said to be flying iPhones from India to US to avoid Trump tariffs
