A lack of robots are not the the only thing preventing iPhone manufacture in the US
Analyst Ming-Chi Kuo says, perhaps obviously, that Trump’s new 25% tariff on Apple shouldn’t make the company move manufacturing to the US, because it’s still far cheaper to import.
Trump announced his 25% tariff on Apple’s iPhones — for once specifically naming a US business instead of nonsensically claiming foreign countries would pay — on Friday, May 23, 2025. It immediately sent Apple’s share price tumbling, yet again, but analyst Ming-Chi Kuo agrees with AppleInsider and common sense interpretation of the tariffs about the long-term impact.
Kuo goes no further than looking at the immediate bottom line cost, but chiefly because that issue alone is compelling enough. One estimate was when Dan Ives calculated it would cost Apple $30 billion more and take at least three years for Apple to move just 10% of its supply chain to the US.
That $30 billion may be optimistic.
Investment firm Morgan Stanley puts the cost at hundreds of billions of dollars. And TSMC’s first two processor factories in Arizona have already cost it $40 billion.
If Trump was serious about bringing manufacturing back to the US, he would be investing in education to train up the immense number of skilled engineers required. Instead, the tariffs are political posturing that will cost Apple $900 million in the current quarter.
Apple can take that $900 million hit, and even though the new 25% tariff on its own will add billions to its costs, the company can surely withstand that too.
Only Apple knows what this tariff will cost them in total, however, since the company does not publish sales volumes. Even if it did, the 25% tariff is on the import price rather than the final retail price.
Then, too, the tariffs are on individual iPhone imports and 25% of an iPhone 16 Pro Max will be different to 25% of an iPhone 16.
Kuo is right that Apple should pay the tariff instead of moving manufacturing to the US. However, if Apple did choose to move, it would presumably still be paying the tariff for each of the many years before US production could possibly begin.
Trump says Apple should manufacture in the US, and he says that his tariffs discourage investment in other countries. Instead, they are solely accelerating that investment in foreign countries.
Apple’s recent reorganizing of its supply and distribution chains to minimize the impact of the “reciprocal” tariffs, though, is just the latest in the company’s years of maneuvering. While moving away from China is partly about reducing over-reliance on one source, it’s also long been about tariffs.
Back in 2018, iPhone assembly firm Pegatron was reported to be moving from China because of trade tensions. By 2024, Apple suppliers had already spent over $16 billion on plans to reshore to places such as India.
Even in the midst of Trump’s tariffs, Foxconn is not looking to move to the US, it is planning to double iPhone production in India by the end of 2025.
So the tariffs don’t hurt other countries. They just see US businesses taking the hit — and eventually, passing it on to their buyers.
