Apple, Trump announce $100B investment in U.S. for supply chain

UPI

3 days ago

1 of 6 | President Donald Trump and Apple CEO Tim Cook shake hands in the White House's Oval Office on Wednesday after announcing an additional $100 billion investment by the company in the U.S. It will total more than $600 billion over the next four years. Photo by Bonnie Cash/UPI | License Photo
Aug. 6 (UPI) -- Apple CEO Tim Cook and President Donald Trump on Wednesday announced a $100 billion investment plan to shift the tech company's supply chain to the United States after pledging $500 billion over four years in February.
The final assembly of Apple's major products, including the iPhone, iPad and MacBook, will continue to take place in China and India, Cook said in the Oval Office of the White House. In 2024, Apple generated $390 billion in revenue with 51% from iPhone sales.
This announcement comes as Apple, other countries and foreign nations are bracing for further impact from tariffs. New reciprocal tariffs take effect on Thursday with some already in place and a 10% on most trading partners since April.
Ahead of a threatened 100% tariffs on foreign chips and semiconductors, Cook describes an increase in production of those items in the United States.
Trump and Cook announced the launch of the American Manufacturing Program to boost the supply chain to the United States. Apple is working with Corning, Coherent, GlobalWafers America, Applied Materials, Texas Instruments, Samsung and Broadcom.
"I'm glad to be here with you today, and I'm very proud to say that today, we're committing an additional $100 billion to the United States," Cook told Trump during their White House event.
In the United States, Apple will manufacture the glass covers on all iPhones and Apple Watch devices sold worldwide. Corning, which has made glass products for more than 60 years, will dedicate its entire facility in Harrodsburg, Ky., to the Apple products under a $2.5 billion commitment.
"Apple will massively increase spending on its domestic supply chain for the iPhone, and will build the largest and most sophisticated smart glass production line in the world," Trump said.
Cook gave Trump a piece of glass from the plant with a 24-karat gold base and the Apple logo cut into it. The message reads "Made in USA" with the year 2025.
"You've been a great advocate for American innovation and manufacturing," Cook told Trump about the piece, which was designed by an Apple worker who was a Marine Corps corporal .
Other changes are in the works.
"Apple will also build a 250,000-square-foot server manufacturing facility in Houston, and invest billions of dollars to construct data centers across the country from North Carolina to Iowa to Oregon," Trump said.
Apple earlier said the Houston server plant will open next year.
In its plan to invest $500 billion in the United States, the company will open a manufacturing academy in Detroit and source rare earth -- critical for electronics such as smartphones and TVs -- from U.S.-based supplier MP Materials.
Most Apple items are exempt from tariffs, though the company had an $800 million payout in the last quarter from duties and predicts another $1.5 billion in the next three months.
The United States and China are negotiating on a deal with 30% now charged. India has been informed the duty will be 50%.
"Tim Cook is known to be the supply chain genius of technology," Ted Mortonson, technology sector strategist at financial services company Baird, told CNN. "And I think his whole supply chain team is well aware ... before it happens, what the Trump administration is thinking and not thinking."
With a threatened 100% tariff on all computer chips imported into the United States, Cook said Apple will produce more than 19 billion chips for its products this year in 24 factories in 12 states.
"I'm proud to say that Apple is leading the creation of an end-to-end silicon supply chain right here in America, from design to equipment to wafer production to fabrication to packaging," Cook said during the event.
Trump on Wednesday said the government is "going to be putting a very large tariff on chips and semiconductors ... But the good news for companies like Apple is, if you're building in the United States, or have committed to build, without question, committed to build in the United States, there will be no charge."
Trump had hoped for Apple products to be built in the United States, posting on May 23 on Truth Social: "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."
He changed his tune on Wednesday.
"So I don't know when it shows up, but there are a lot of factories and a lot of plants that are either under construction or soon we'll be starting construction," he said. "So can't tell you exactly when, but I want to be around in about a year from now and two years from now, because we're going to see an explosion, I think."
Ahead of the meeting, White House spokesperson Taylor Rogers said in a statement to CNN: "President Trump's America First economic agenda has secured trillions of dollars in investments that support American jobs and bolster American businesses. Today's announcement with Apple is another win for our manufacturing industry that will simultaneously help reshore the production of critical components to protect America's economic and national security."
Apple shares closed Wednesday with a 5.09% gain to close at $213.25 in it biggest single-day increase this year. Apple shares reached a record $247.10 on Feb. 24 and was down to $172.42 on April 8, before Trump announced a 90-day pause of reciprocal tariffs.
Apple has a market capitalization of $3.17 trillion. At one time, Apple had the biggest amount in the United States, but now it is third behind two other tech companies, Nvidia leads with $4.02 trillion and Microsoft at $3.73 trillion.