If Apple ever produces a “made-in-USA” iPhone, you can expect it to be expensive.
President Donald Trump brought back the idea of American-made iPhones on Friday when he threatened a 25% tariff on Apple if it doesn’t start manufacturing its smartphones stateside for US buyers.
“I have long ago informed Tim Cook of Apple that I expect their iPhone’s that will be sold in the United States of America will be manufactured and built in the United States, not India, or anyplace else. If that is not the case, a Tariff of at least 25% must be paid by Apple to the U.S.,” he said in a Truth Social post.
Trump appeared to be responding to the changes Apple made to its supply chain after the president announced sweeping tariffs in April. At the time, Apple was navigating a potential 54% tariff rate on China and a 46% tariff on Vietnam — the two manufacturing hubs that analysts estimate produce the vast majority of Apple’s iPhones.
A tariff rate of that magnitude threatened to add serious costs to Apple. In an April note, Rosenblatt analyst Barton Crockett estimated Apple could see $40 billion in tariff costs. At the time, Crockett and Wedbush Securities analyst Dan Ives predicted a roughly 40% price increase on tech devices to ease the impact of the tariffs. Apple was under pressure to either find a supply chain solution or consider raising the price of the iPhone.
Apple responded by flexing its supply chain might, continuing to ramp up production in India, which manufactures a small but growing share of overall iPhone production.
Tim Cook, speaking to analysts during Apple’s quarterly earnings call on May 1, offered insight into Apple’s plan to navigate the uncertain tariff environment — Apple would try to sell Americans as many iPhones manufactured in India as possible.
“For the June quarter, we do expect the majority of iPhones sold in the US will have India as their country of origin, and Vietnam to be the country of origin for almost all iPad, Mac, Apple Watch, and AirPods products also sold in the US,” Cook said. “China would continue to be the country of origin for the vast majority of total product sales outside the US.”
Crockett wrote in his April note that shifting iPhone production to the US isn’t feasible for the immediate future. Apple sells a huge number of iPhones to Americans every quarter, and tooling up new factories takes time, as does ensuring the quality of manufacturing reaches Apple’s standards. There’s also the question of whether Americans want to work in manufacturing jobs in the first place.
The iPhone 16 starts at $799, with the iPhone 16 Pro starting at $999 — so how much could a made-in-America iPhone cost?
Ives estimated that it would be priced at $3,500.
With Trump’s talk of a 25% iPhone tariff, Cook has some tough decisions to make as he navigates the situation, which, like Trump’s other tariff threats, could quickly change.
Apple’s new batch of iPhones are expected to be announced in September; shoppers and Wall Street alike will be watching to see if the company decides to raise prices.