Forward-looking: Apple is preparing a dramatic overhaul of its global manufacturing strategy, aiming to move all assembly of iPhones destined for the US market from China to India by the end of 2026. This ambitious plan, which the Financial Times confirmed with multiple sources close to the company, is a direct response to escalating trade tensions and steep tariffs imposed by the Trump administration on Chinese imports, which have threatened to drive up the cost of Apple’s flagship product and disrupt its finely tuned supply chain.

For nearly two decades, Apple has relied on China as the backbone of its iPhone production, leveraging the country’s vast manufacturing infrastructure and skilled workforce to meet global demand. About 80 percent of the more than 60 million iPhones sold annually in the US are assembled in China, primarily through third-party partners such as Foxconn. However, the US government’s imposition of tariffs as high as 145 percent on Chinese goods has forced Apple to accelerate its efforts to diversify production.

India has emerged as the focal point of this strategic shift. In recent years, Apple has been gradually ramping up its manufacturing presence in the country, working closely with partners Tata Electronics and Foxconn. The company began assembling iPhones in India in 2017, initially focusing on lower-cost models and expanding to flagship devices in 2023.

To meet its new target, Apple will need to double its annual iPhone output in India from about 40 million to more than 80 million units, which will require significant investment and expansion of local facilities.

The urgency behind this transition became evident when Apple, anticipating the impact of tariffs, began shipping Indian-assembled iPhones to the US ahead of new levies taking effect. In April, the company reportedly flew as many as 1.5 million iPhones into the United States to beat the tariff deadline, even lobbying Indian airport authorities to expedite customs clearance.

Despite these efforts, Apple still faces challenges, as manufacturing costs in India are estimated to be 5 percent to 10 percent higher than in China, due in part to higher import duties on components and the need to import pre-assembled parts from China.

The shift is not without complications. While India offers a promising alternative, the country’s manufacturing ecosystem is still developing. Reports indicate that some Indian factories have struggled to meet Apple’s stringent quality standards, with yield rates lagging behind those of their Chinese counterparts.

Moreover, Apple’s reliance on Chinese suppliers for key components means that the company’s supply chain will remain intertwined with China for the foreseeable future.

The Trump administration’s tariff strategy has created a volatile environment for multinational companies like Apple. While smartphones have been temporarily exempted from the harshest tariffs, a separate 20 percent rate still applies to Chinese imports, and the threat of further levies looms.

India, too, has faced a 26 percent tariff on its exports to the US, though this has been suspended for 90 days as trade negotiations continue.

Ultimately, Apple’s move to shift US-bound iPhone assembly to India marks one of the most significant realignments in the company’s manufacturing history.