Following the announcement of potential tariffs by Donald Trump, concerns arose regarding potential price increases for iPhones. However, Apple’s iPhone exports from India have been unaffected by the tariffs. The U.S. administration had earlier granted exemptions to electronic goods, including smartphones and computers, from reciprocal tariffs. This move allowed Apple’s iPhone and other devices to enter the U.S. market from India without added duties, offering relief to Apple and other tech firms.
Apple appears willing to absorb extra costs to avoid disrupting its growth in India. However, analysts warn that the risk of a 50% tariff cannot be ignored. If imposed on iPhones, this could force Apple to adjust prices in key markets, potentially increasing costs for consumers.
Despite the current exemption, the situation is fluid. Past actions using Section 232 powers to impose tariffs have impacted various goods. Experts caution that these powers could also be applied to smartphones.
India has emerged as a key manufacturing location for Apple, beyond just a China alternative, particularly for iPhones destined for the U.S. market. The company’s success depends on the U.S. government’s future trade policies, especially regarding tariffs.
Data indicates that a significant portion of iPhones sold in the U.S. are now made in India. During the period between April and June, 71 percent of the iPhones sold in the U.S. were manufactured in India, compared to 31 percent a year earlier. Furthermore, Foxconn’s iPhone exports from India between March and May totaled $3.2 billion, with almost all of them going to the United States.
During an earnings call, Apple CEO Tim Cook noted consistent iPhone production levels, signaling that India remains a crucial production hub for iPhones sold in the U.S.