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By Hamid Ganji · Posted
Why it's almost impossible to produce a smartphone in the United States by Hamid Ganji If you look at the back of some Apple products, you can see the famous phrase “Designed by Apple in California, Assembled in China.” This phrase appears on products from one of the largest smartphone brands in the United States. These products are designed in the U.S., but their manufacturing takes place in China, India, Vietnam, or even Brazil. But why can’t Apple, as one of the largest American tech companies, produce its iPhones on U.S. soil? The idea for this topic came to me after the Trump Foundation launched a smartphone called the T1 and claimed that it was designed and built with American values in mind. However, this claim did not last long, as it was revealed that Trump’s phone was actually a rebranded HTC U24 Pro, with only a gold case and minor internal component changes. You see? Even a phone that is supposed to represent American values is manufactured in China. With a gross domestic product (GDP) exceeding $32 trillion, the United States is currently the world’s largest economy, while China ranks second with around $20 trillion. On the other hand, the United States is by a wide margin the global leader in various technological fields, and American companies spend hundreds of billions of dollars annually on research and development. From Apple and Google to Microsoft, Lockheed Martin, Boeing, and others, American tech and industrial giants lead their foreign competitors in many sectors. The United States also has no shortage of smartphone brands. Apple, Google, and Motorola are among the major brands in the smartphone market, collectively holding a significant share. However, the vast majority of their products are manufactured outside the United States. So why is it that the world’s largest economy, home to the most advanced technology companies and industrial powers, cannot produce a smartphone on its own soil? Let’s explore this question together. Even threats to impose tariffs won’t work After Trump entered the White House as the 47th President of the United States, his administration adopted strict tariff policies. One of these policies was the imposition of a 25% tariff on smartphones manufactured outside the United States. Trump said he “had a little problem” with Apple CEO Tim Cook over producing smartphones outside the U.S. So he thought that threatening a 25% tax on imported phones might force Apple to bring manufacturing back to the United States. “I have long ago informed Tim Cook of Apple that I expect their iPhones that will be sold in the United States of America will be manufactured and built in the United States, not India, or anyplace else,” Trump wrote on Truth Social. Image via The White House Although Apple currently manufactures some of the iPhone’s chips in the United States with TSMC's help, it still shows no willingness to shift full iPhone production to the country. At the time, renowned Apple supply chain analyst Ming-Chi Kuo wrote on X, “In terms of profitability, it’s way better for Apple to take the hit of a 25% tariff on iPhones sold in the US market than to move iPhone assembly lines back to the US.” However, manufacturing a smartphone in the United States is not as easy as it might seem, and many technical and economic barriers are involved. The lack of necessary manufacturing hubs There is a clear reason why many companies prefer to manufacture their products in China. China has established itself as the main global manufacturing hub for international companies, and over the past few decades, large contract manufacturers have emerged there, allowing companies like Apple to outsource production. One such example is Foxconn, which also manufactures some Apple products in India. Building the infrastructure required to produce smartphones in the United States would require tens of billions of dollars in new investment. Factories would need to be built, essential manufacturing equipment would have to be installed, and, most importantly, a skilled workforce capable of operating these systems would need to be recruited and trained. The United States currently lacks the core infrastructure needed to manufacture smartphones, and for this reason, many companies prefer to outsource production to Chinese contractors rather than spend tens of billions of dollars to build that infrastructure, which is significantly more economically efficient. Additionally, building such infrastructure in the United States could take up to a decade, ultimately leading to a significant increase in the product's final price for consumers. Shortage of trained labor in the U.S. compared to China Decades of serving as a global manufacturing hub have allowed China to build a massive talent pool in the production sector that is almost unmatched worldwide. Today, if a company chooses to manufacture its products in China, it can be confident that the workers involved in production have years of experience in their respective roles and are capable of producing high-quality goods with minimal errors. Even if we assume that tens of billions of dollars were invested in building smartphone manufacturing infrastructure in the United States, finding skilled workers would remain highly challenging. Apple CEO Tim Cook visiting the iPhone 6 assembly line in China in 2014. Image: Tim Cook on X In a 2015 interview on CBS’s 60 Minutes, Tim Cook said the main reason Apple isn’t producing in the US is a lack of skills. "China put an enormous focus on manufacturing, in what you and I would call vocational kind of skills. The US over time began to stop having as many vocational kinds of skills. I mean you could take every tool and die maker in the United States and probably put them in the room that we're currently sitting in. In China you would have to have multiple football fields,” Cook said. Also, in 2017, at the Fortune Global Forum in Guangzhou, Cook once again emphasized the importance of highly skilled Chinese workers. “China has moved into very advanced manufacturing, so you find in China the intersection of craftsman kind of skill, and sophisticated robotics and the computer science world. That intersection, which is very rare to find anywhere, that kind of skill, is very important to our business because of the precision and quality level that we like. The thing that most people focus on if they’re a foreigner coming to China is the size of the market, and obviously, it’s the biggest market in the world in so many areas. But for us, the number one attraction is the quality of the people,” Apple CEO said. Higher labor costs in the United States Producing almost any product in the United States is more expensive than in many other countries, and one of the main reasons is the higher cost of labor in the U.S. According to the Bureau of Labor Statistics, median weekly earnings of full-time workers in the United States were $1,235 in the first quarter of 2026. Meanwhile, the average annual salary in China's private sector in 2025 was RMB 71,590 (US$9,961). In many parts of the world, the weekly wage of an American worker is equivalent to several months of income. Another important factor to consider is that in the United States, the workforce capable of working on a smartphone assembly line is highly specialized and therefore commands higher-than-average wages. According to an estimate by Bank of America, producing an iPhone in the U.S. is technically possible, but “iPhone cost can increase 25% purely on higher labor cost in the U.S.” However, this 25% increase applies only if final assembly is performed in the United States while components are still sourced from China or elsewhere. In this case, the price of a base iPhone would rise from $799 to around $1,000. But in another scenario, if Apple were to produce the required components for the iPhone within the United States, production costs could increase by more than 90%. Trump’s dream for a “Made in the USA” iPhone might never come true In a free-market capitalist economy, one of the primary responsibilities of any CEO is to maximize profit. Using Apple as an example, Tim Cook’s role is to maximize the company’s profits so that it can fund research and development for new products and invest in areas such as artificial intelligence, while also keeping shareholders satisfied. Therefore, it is entirely understandable that Apple would choose not to bring its manufacturing back to the United States and instead keep production in countries where labor is cheaper, and products can be manufactured at a lower cost, thereby maximizing its profit margins. What is your opinion about manufacturing smartphones in the United States? If you are an American citizen, would you be willing to pay hundreds of dollars more for a smartphone made domestically in the USA? Let us know in the comments. -
By datacenter · Posted
Will test it, thanks! -
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By +Edouard · Posted
Cheers everyone for the replies. It's been very useful. 👍
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