Apple’s sleek devices, famously "designed in California," are largely built thousands of miles away in China—a supply chain now facing mounting pressure under renewed US trade policy shifts.

With over 220 million iPhones sold annually, and an estimated 90% manufactured in China, Apple’s reliance on the Asian powerhouse has long been a cornerstone of its operations. However, recent developments in US trade policy, led by former President Donald Trump, have cast a long shadow over this relationship. The latest tariff hikes—reaching up to 245% on some Chinese imports—pose a threat to the structure of global electronics manufacturing.

Although smartphones and computers were temporarily exempted from these tariffs, the reprieve may be short-lived. Trump has since warned that more levies may be imminent, targeting the entire electronics supply chain, including semiconductors. This threatens to destabilize the interdependence that has defined US-China tech relations for decades.

China has reaped enormous benefits from its role in Apple's success. Since entering the Chinese market in the 1990s and formalizing operations in 2001, Apple has helped transform local suppliers into global manufacturing leaders. Foxconn’s vast factory in Zhengzhou—known as “iPhone City”—is a testament to that evolution.

At the height of Apple’s China expansion, the company cultivated a broad base of suppliers. As of 2024, 150 of its top 187 suppliers operated factories in China. Apple CEO Tim Cook has publicly stated that no supply chain is more crucial to the company than China’s.

Despite this, the Trump administration has pressed forward with its push for "onshoring" tech manufacturing, urging companies to shift production to the United States. Commerce Secretary Howard Lutnick recently claimed that large-scale manual assembly could be brought back to American soil—a notion many experts find unrealistic.

Analysts remain skeptical about Apple’s ability to relocate its vast operations. While Apple has taken steps to diversify, moving some production to India and Vietnam, these countries face similar tariff threats. Manufacturing infrastructure comparable to China’s remains limited elsewhere, complicating relocation efforts.

Apple has found itself caught in a geopolitical tug-of-war, with Beijing pushing back against US pressure. China has imposed retaliatory tariffs and restricted exports of critical rare earth elements essential for electronics manufacturing.

Domestically, Apple faces increasing competition from Chinese firms like Huawei and Xiaomi, which have benefited from the robust supply chains originally built around Apple’s needs. The company’s market share in China has been eroded, and economic slowdown, coupled with consumer caution and political constraints, has further strained performance.

In response, Apple announced a $500 billion investment in the US, signaling its intention to align more closely with Washington's expectations. Yet, uncertainty lingers. With Trump's administration hinting at further tariffs, Apple must navigate a shifting landscape, balancing political pressure with operational reality.

Industry experts suggest the situation remains fragile. While recent exemptions provide short-term relief, Apple’s deep entanglement in the global supply chain—especially with China—means that any further escalation could trigger significant disruptions.

For now, Apple continues to walk a tightrope, maintaining its production dominance while preparing for an increasingly unpredictable future in global trade.