Apple May Have to Price iPhone at $3000 to Meet Donald Trump’s ‘Make in US’ Vision

Donald Trump, the former President of U.S., has been causing trouble to U.S. companies for years now to bring back their manufacturing to U.S. shores. One of his favorite targets of criticism has been Apple Inc., the technology goliath which is well known all over the world for its iPhones. Trump’s wish to have Apple manufacture iPhones here in America, as compared to China or India, has again reared its head in the form of yet another sensationalized argument that in doing so, it would be impossible to manufacture an iPhone at a high cost of $3,000.

This forecast is founded on recent meeting and evaluation by authorities, after Trump supposedly contacted Apple CEO Tim Cook sometime ago. Trump supposedly requested Cook on the phone to forego the production surge for Apple in India. The effects are colossal, especially when set against the current consolidation by Apple of the worldwide foundation of supply.

The Cost of ‘Made in America’

It takes around $1,000 to buy an iPhone – a price tag that is too high for most markets around the world. That said, insiders note relocating Apple’s production base from countries like China or India to the US would nearly double the production cost. The final price of an iPhone might even be a price tag of around $3,000.

The why is self-evident. America has infinitely higher labor costs than China, India, or Vietnam. Those countries have built themselves low-cost industry bases with trained human resources, massive infrastructure, and government subsidies specifically for mass industry. In America, creating and maintaining comparable capability would be a question of massive investment of money and operating expenses.

The Shift from China to India

Historically, Apple’s manufacturing empire stood on China as its foundation, with over 80% of it manufactured there. The huge network has near-half-a-million workers and decades of industrial maturity. Despite that, rising geopolitical tensions and supply chain diversification needs led Apple to shift some of its manufacturing out of China in a phased manner.

India is now one of the top destinations in Apple’s new strategy. Apple has already begun manufacturing iPhones in India. It will be one of the world’s top manufacturing hubs. India possesses the right combination of highly skilled workers, low-cost production, and pro-business policies. Apple’s entry into India is not to replace American workers but to establish a more diversified and resilient supply chain that will reduce dependence on China.

Trump’s Backlash and Economic Implications

Trump’s backlash urging Apple to restrict its operations in India has left individuals uncertain. Experts claim that such a suggestion can be economically unfeasible as well as harmful. Prashant Girbane, Director General of MCCIA, also clarified that shifting iPhone manufacturing from India to America would add considerably to the expense. Girbane emphasized that the $3,000 hike from $1,000 would be sufficient to discourage American buyers, whether domestic consumers would be willing to embrace such a high price in the spirit of nationalism or not.

In addition, Girbane said the company is not exiting America to head to India but from China to India—a move to diversify and insulate the supply base. Apple is not exiting America, practically; it is centralizing its global business in an attempt not to put all of its eggs into one production basket, especially one such as China whose tense trade with America has dominated headlines recently.

The Cost-National Pride Trade-Off

While Trump’s insistence on an iPhone made in America is motivated by patriotic fervor and vow of bringing American industry back home, the math of the argument does not compute. A $3,000 iPhone can destroy millions of customers and destroy Apple’s reputation as a stingy, high-tech technology company.

In addition to that, Apple’s competitiveness on a worldwide basis also depends on its ability to offer fantastic products at fantastic prices in different economies. Taking everything back to the U.S. would disturb this balance, reducing margins or forcing Apple to take some not-so-nice price and product decisions.

Strategic Manufacturing: The Middle Ground

Instead of shifting entirely to America, Apple will likely keep its hybrid model. With production in India, Vietnam, and other countries, Apple is able to diversify risks, retain low manufacturing costs, and build a strong global base. This type of strategy also enables Apple to be adaptable to world trade disruptions and shifting political environments.

Trump’s vision, rooted in positive sentiments toward the American worker, must be handled more diplomatically in the next global economy. It is not a national ego fantasy to re-shore assembly; it is economic viability, consumer choice, and competition technology.

Donald Trump’s vision that Apple is producing iPhones in the United States is one aspect of an overall call for American industrial revival. But the dire economic costs of doing so inflating the cost of an iPhone by almost half are a steep price to pay. As attractive as the vision is, worldwide production realities, public opinion, and business acumen suggest that an even-keeled, diversified supply chain is a more workable, economically sound option. Apple’s recent move into India is an acceptance of this new world not an America exclusion, but a reaching for strategic globalization.