Apple to Shift Majority of U.S. iPhone Production to India by 2026 Amid Rising China Tariff Risks
Apple is accelerating its efforts to manufacture the majority of iPhones sold in the United States at its Indian facilities by the end of 2026, a move aimed at navigating the challenges posed by potential higher tariffs on Chinese imports, a source familiar with the matter told Reuters.
The U.S. tech giant is engaged in urgent discussions with its major manufacturing partners, Foxconn and Tata, to achieve this transition. As of now, approximately 80% of the more than 60 million iPhones sold annually in the U.S. are produced in China.
Faced with growing trade tensions between the U.S. and China, Apple sees India as a critical alternative for its manufacturing operations. Although producing iPhones in India currently costs about 5–8% more than in China—rising to as much as 10% in some instances—Apple has ramped up its Indian output significantly. In March alone, Apple shipped 600 tons of iPhones worth $2 billion from India to the United States, setting new records for both Tata and Foxconn, with Foxconn contributing $1.3 billion of the shipments.
The Indian government, under Prime Minister Narendra Modi, has been actively promoting the country as a global smartphone manufacturing hub. However, higher duties on imported mobile phone parts compared to other countries have kept production costs elevated. Despite this, lower U.S. tariffs on Indian imports—26% compared to over 100% for Chinese goods—have given India an edge in the shifting global manufacturing landscape.
Apple’s strategic move comes as Washington has paused most tariffs for three months on imports from various countries, except China, keeping pressure on companies heavily reliant on Chinese production lines.
Currently, Foxconn and Tata, Apple’s main suppliers in India, operate three factories in the country, with two more facilities under construction. This expansion underscores India’s growing importance in Apple’s global supply chain as the company seeks to diversify beyond China.
The Financial Times was the first to report on Apple’s updated production plans on Friday. Apple, Foxconn, and Tata have yet to officially comment on the developments.