Big Tech Company Will Shift Manufacturing To United States, President Trump Says

Go to Article

According to reports, President Trump announced that Apple Inc. CEO Tim Cook agreed to shift manufacturing from Mexico to the United States.

Trump said that Cook “stopped two plants in Mexico” and will build products in the United States, Bloomberg reports.

“They don’t want to be in the tariffs,” Trump said, according to Bloomberg.

Per Bloomberg:

It’s not clear what manufacturing facilities Trump was referencing, though Foxconn Technology Group — which manufactures the company’s iPhones — already has a large manufacturing presence in Mexico and has announced plans to expand its footprint there.

A representative for Apple didn’t immediately respond to a request for comment.

Cook is among the tech industry leaders who have sought to nurture a close relationship with the president since his reelection, attending his inauguration last month and traveling to his Mar-a-Lago estate in Florida during the presidential transition.

Cook’s company risks being caught in the middle of an escalating trade fight between the US and China, with Trump’s 10% tariff on Chinese-made goods posing a challenge for Apple as it seeks to address sluggish iPhone sales. China is weighing a probe into Apple’s policies and the fees it charges app developers. China is Apple’s biggest manufacturing hub, while the US is its largest market.

WATCH:

From the Financial Post:

Apple doesn’t rely heavily on Mexico for production. The company has used suppliers — Molex LLC, Yageo Corp. and Skyworks Solutions Inc. — to make some parts in the country, but most of its manufacturing happens in Asia.

One way that Apple is relying more on domestic production is through its partnership with Taiwan Semiconductor Manufacturing Co. That company is building factories in Arizona to make chips, including semiconductors for the iPad and Apple Watch.

During Trump’s first term, Cook was able to leverage his relationship with the president to win tariff carve-outs for its signature iPhone. But the president has suggested that the company’s devices might not be so lucky this time as he seeks to impose sweeping new tariffs on imported goods, telling reporters that he’s looking to avoid exemptions.

Taiwan’s government has pledged to help companies like Foxconn, also known as Hon Hai Precision Industry Co., shift production lines in the aftermath of Trump’s executive orders imposing across-the-board 25% tariffs on Canada and Mexico. Trump has paused implementation of those tariffs for now, but said they could still go back into effect if he doesn’t see sufficient progress on immigration and anti-narcotic priorities.



Comment on this Article Via Your Disqus Account