Apple faces setback: US threatens 25% tariff on iPhones made outside America

The company Apple is once more in the spotlight of trade policy as President Trump has stated he plans to impose a 25% tariff on iPhones produced outside the United States, including in India. As Apple increases its manufacturing in India, it produced iPhones worth $22 billion there last year, more than double the amount made the previous year. Apple is coming under more scrutiny from American officials over its manufacturing because former President Trump promised a 25% tariff on iPhones imported into the US if they stay overseas. Apple is now intensively moving its manufacturing from China to India which puts India at the heart of the company’s supply line.

Apple faces setback due to tariff threat 

President Trump is not satisfied with Apple choosing to produce iPhones in India to sell in the US. From the White House, Trump told reporters. “I have long ago informed Tim Cook of Apple that I expect their iPhones 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 US.”

He further clarified that the tariff would not only apply to Apple but also to other smartphone manufacturers like Samsung, stating, “It would be also Samsung and anybody that makes that product, otherwise it wouldn’t be fair. When they build their plant here, there is no tariff.”

The main statement by Apple analyst Ming-Chi Kuo, shared via an X (formerly Twitter) post,  Kuo stated, “In terms of profitability, it's way better for Apple to take the hit of a 25% tariff on iPhones sold in the US market than to move iPhone assembly lines back to the US.”

India’s role in Apple’s supply chain

Apple’s reliance on India has risen as iPhone exports from India to the US hit a 76% increase in April 2025 alone. Big manufacturers dealing with Apple, like Foxconn and Pegatron, are now producing more products in India and the company hopes to manufacture most of its iPhones for the US from India by 2026. Moving away from China is part of Apple’s effort to balance its business amid rising tensions and higher production costs. Still, challenges remain in India’s manufacturing industry, including tough import tariffs on some equipment and barriers from China against sending advanced equipment and well-trained workers.

The situation is moving fast and according to reports, Apple’s Tim Cook is involved in talks with American officials despite ongoing investments in India. Expect the cost of iPhones in the US to go up if the new tariff is put in place. Currently, India is still key to Apple’s plans for global manufacturing, despite tensions from both Washington and Beijing.