5 days ago
Why It's Nearly Impossible For Apple To Make iPhones In The U.S.
Apple is under pressure to return manufacturing to the U.S. but the solution is not a simple ... More one.(Photo by Michael M. Santiago/Getty Images)
As I have written here before, I have extensive experience in global manufacturing and what it takes to build a world-class operation that produces high-quality products in large quantities.
Because of this understanding and decades of experience in this field, I get frustrated when someone suggests that a company just move its manufacturing to the U.S. without understanding what it would take and how long it would take to build out such an operation.
The current administration keeps beating this drum about making iPhones in the U.S., driven by economic nationalism, supply chain resilience concerns, and growing interest in "reshoring" advanced manufacturing. But compelling as the narrative may be at first blush, the realities on the ground—and in the supply chain—paint a far more complex picture.
Let's be clear: It's not that Apple won't manufacture iPhones in the U.S.—it's that, under current conditions, it can't. Understanding why requires a deep dive into the very DNA of how Apple builds products at a global scale.
At the core of each iPhone lies a supply chain ecosystem intensely localized to East Asia, specifically China, Taiwan, Japan, South Korea, and more recently, Vietnam and India. Over the last two decades, the region has constructed an ultra-efficient, hyper-specialized cluster of parts suppliers, tooling specialists, and final assemblers. Apple does not simply contract out Foxconn or Pegatron; it has the benefit of an integrated network where the screws, camera, circuit board, batteries, and lenses are all made—typically within a 30 to 50-mile radius of the final assembly factory.
The U.S., on the other hand, doesn't have this ecosystem. It would take rebuilding an entire industrial base, eroded since the 1990s, to manufacture an iPhone in the U.S.—and that's not a one or two-year task. We're looking at a decade-long shift at a minimum.
Tim Cook has noted that Apple can locate 8,700 industrial engineers in China in weeks. It would take nine months or more to accomplish this in the United States. That is not because American workers are less skilled—it is because the workforce is not sized or trained for this type of high-volume, precision electronics assembly.
In China, millions of laborers are ready to shift into high-tech manufacturing at a moment's notice. They live near enormous campuses built for this purpose and often in dormitory-style accommodations. There is no such industrial flexibility in the United States—not on that scale or speed.
I have been to one of these campuses and talked to some of these Apple-trained employees. Many were brought to these campuses from working in the fields with their families and had very little prospect for better-paying jobs. Apple offered to train them through what we would call a trade school-like education, and this gave Apple a dedicated workforce that became skilled at making iPhones and other electronic devices.
It would likely double or triple the cost of each unit if Apple were to manufacture iPhones domestically. Labor costs, investment in infrastructure, and the need to fly in or replicate Asia-based component vendors would make local manufacturing unviable—at least without passing on the cost to the consumer or taking a margin hit.
And for a company such as Apple, which has to keep up with global competitors in innovation and cost structure, that simply does not compute.
There have been demands from the public and the government to pressure Apple to "bring jobs home." Well-intentioned though they are, they overlook the fundamental reality: you can't relocate a hyper-optimized worldwide supply chain overnight. Tax subsidies and credits help, but they don't account for the pure complexity of re-engineering logistics, manufacturing equipment, and worker training at a national scale.
Apple does have to its credit some U.S.-based manufacturing investments—like the Mac Pro in Texas and the new chip fab investments via its partners. But the iPhone is a different beast. It's Apple's highest-volume, most complicated product. Landing it on U.S. shores would be like transplanting a rainforest into the desert.
Apple not producing iPhones in the U.S. is not a failure of patriotism—it's an indicator of the new realities of global tech manufacturing. The U.S. can play a greater part in this ecosystem, especially in semiconductor R&D and next-generation materials science. Still, manufacturing iPhones at home would require nothing short of a renaissance in manufacturing.
Although Apple's CEO, Tim Cook, has a serious balancing act ahead of him in dealing with this administration's demands, bringing this type of manufacturing to the U.S. anytime soon is impossible.
Apple will continue to manufacture where infrastructure, talent, and supply chain allow it to produce at scale—with precision, efficiency, and speed. In consumer electronics, these three are essential for success.
Disclosure: Apple subscribes to Creative Strategies research reports along with many other high tech companies around the world.
