India takes center stage for iPhone production
That one sentence signals a massive shakeup. Apple has long relied on China as the manufacturing engine behind nearly all of its devices. But with rising geopolitical tensions and tariffs threatening to erode profit margins, India has emerged as Apple’s go-to backup plan.
Apple’s expansion in India is not just about dodging tariffs. It’s also a broader diversification move in response to lessons learned during the pandemic and trade conflicts. With help from partners like Foxconn and Tata, Apple has been steadily increasing its local assembly operations in India, which also happens to be one of the world’s fastest-growing smartphone markets.
According to market analysts, iPhone production in India ramped up significantly toward the end of the quarter. Canalys noted that while China still accounts for most Apple devices sold globally, production in India is increasingly focused on U.S.-bound supply.
Vietnam becomes the hub for non-iPhone gear
Meanwhile, Vietnam has taken over as the primary production base for iPads, Macs, AirPods, and Apple Watches bound for the U.S., completing Apple’s regional rebalancing effort. Cook emphasized that China will remain a major player in Apple’s supply strategy, particularly for non-U.S. markets, but that relying on a single region is simply too risky.
“Having everything in one location had too much risk,” Cook said. “You could see that kind of thing continuing in the future.”
Analysts warn of growing pains near-term
Still, challenges remain. Analysts warn that India’s infrastructure and supply chain maturity lag behind China’s. Execution timelines, manufacturing capacity, and labor costs could all pose headwinds. Emarketer’s Jacob Bourne noted that even a well-planned shift could bring “unavoidable cost increases” that may shrink margins or be passed on to consumers.
Adding complexity, many components used in Apple devices still cross borders multiple times before final assembly, meaning parts of the company’s supply chain remain exposed to tariff fluctuations—even if the final product is assembled in a tariff-friendly country.
Apple still profitable, but playing defense
As Apple posts quarterly revenue of $95.4 billion and profits nearing $25 billion, it’s clear the company is still performing. But with trade policy in flux and the global tech landscape becoming more fragmented, Apple’s bold supply chain overhaul may become the blueprint for multinationals navigating a more protectionist world.
– With inputs from Agencies