“Millions and millions of people who flow into small nails to make iPhone. This type of this will come to America.”
This was the US Minister of Trade Howard Lootnick The stadium in April As for the “Tahrir Day” tariff in the Trump administration, The most radical transformation In American commercial policy since the 1930s.
The administration has used many logic for definitions, but the fund that seems to motivate the president is the desire to re -manufacture to the United States over the past few decades, many industries including technology have shipped most of its production abroad, as wages are less, the easiest skilled work, and suppliers are more wonderful.
But the current situation of companies like Apple More complicated than TrumpIf possible, at all. Behind the final smartphone extends a series of suppliers and complexes, especially in Asia, it is difficult to replace.
The Trump ball full of global trade has already been very quickly and infrina to encourage companies like Apple to transfer its production to the United States instead, to re -manufacture us, Washington will need more targeted and more systematic – and more stable – according to economists and experts who spent years, if not contracts, and studying global trade.
Mark Vasto, co -author, says to United States industrial policy: winning competition for good jobs and high -value industries.
How did that happen
Over the past few decades, manufacturing has decreased steadily as a share of GDP, from about 25 % in the fifties to 10 % today. Meanwhile, in the manufacture of Asian forces such as China, Japan and South Korea, the percentage grew above 20 %.
China has in particular the world, thanks to a huge group of skilled workers and deep integrated supply chains. Countless industries – home, home commodities, consumer electronics, and even custom products – on Chinese factories.
“There is this deep ecosystem for the hundreds, if not thousands, from suppliers and sub -manufacturers. You have amazing logistics inside the country and then cross the ports to the rest of the world,” says Dxter Roberts, a senior colleague of the US Research Council.
Dan Wang, a Hoover’s research colleague, also returns to China, that she has a “great arrangement” for manufacturing workers (105 million) from the United States (13 million), and Dan Wang, a researcher at the Hoover Institute. In addition, China has installed more than half of the world’s industrial robots Compared to the US share of only 7 %.
“You can collapse the time of coordination in weeks to just tell all your suppliers that they need to be in your office at 8 am tomorrow,” says Wang, the author of the book “The Next Book”. Breakneck: China seeking future engineer.
25 % / 10 %
The manufacture of the United States as a share of gross domestic product in the 1950s
The most popular images of Chinese manufacturing are complexes such as “iPhone City”, a 5.6 million square meter university campus where 300,000 workers collect most smartphones in Apple. But this narration is increasingly.
China is not just a center of purchase. Thanks to heavy investment, it took the initiative from the United States in some major technologies, such as Electric vehicles And batteries. “The United States is in this very strange position in an attempt to join the technological knee with a low -wage competitor,” says Wang.
Some final gatherings have moved to us Big Tech to “China is one plus“Destinations like Vietnam, India and Mexico. This strategy, which involves the start of the gathering in China and its termination elsewhere, began, under Trump’s first management and accelerated during Covid, when US executive officials scrambled to find alternative manufacturing centers after China entered the closure.
This shift can accelerate if China continues to target a harsh tariff than other countries. Apple, for example, suddenly turned into Sources of more than half of the iPhone tied to the United States from India since Trump took office.
Corporation’s clear incentive, as Apple appears, is the creation of separate supply chains for different markets. When it comes to Apple, Yuqing Xing, at the National Institute for Graduate Studies for Politics Studies in Tokyo, says China can continue to be a major supplier for iPhone for non -American markets while India provides American and Indian markets. Meanwhile, Vietnam will collect other Apple products such as Mac.
However, even if the final association moves to Vietnam and India, the components must come from somewhere – China on foot. This may fit Beijing well, because China dominates many industries that produce these components. However, “China is not sad to see a low -value manufacturing vacation,” Roberts notes that Chinese officials instead encourage the local production of higher value elements such as semiconductors and batteries.
The estimated price of the United States iPhone: $ 3500
105 million/13 million: The number of manufacturing workers in China against the United States
500 billion dollars: Apple promised US investment over the next four years
300000: The number of workers in the city of iPhone in China
But there are risks from the American side as well. Trump is not a fan of Apple’s conversion to India, as it threatens the definitions of any iPhone that has not been made in the United States “I expect (iPhone) that will be sold in the United States of America to be manufactured and built in the United States, not India, or anywhere else”, Trump will be published on social media on social media In late May.
The United States continues to make a lot of things, and a lot is advanced. Aircraft engines, chips and industrial machinery tools are just some of the manufactured goods that they still produce and export from the United States
A 145 % tariffs on Chinese goodsOr even one at the 54 % level that Trump proposed on April 2, would wipe the trade of the United States of China. Anything that has been provided by China for American manufacturing may become immediately applicable. Final products can be imported from countries such as Japan or Vietnam at a lower tax rate, even if they depend on Chinese components, and US -made products are still undermining the price.
After creating disturbances at the beginning in the financial markets, Trump retracted many original tariff plans. As this article was published, the United States had a 10 % tariff on imports from most countries, 30 % tariffs on imports from China, and 25 % tariffs on goods that are important for national security, such as solid parts and cars. Some final products, such as smartphones and laptops, are exempt from import taxes.
“There is no single industrial policy tool that will do it on its own. It takes a full environmental system.”
Mark Fasto, co -author, The industrial policy of the United States
Of course, the Trump administration can always decide to raise the tariffs again later. Or perhaps the courts may strike the entire tariff system as an example of the executive transgression, as some federal judges suggested in recent weeks. In fact, no one knows what will come after that, which makes it difficult for companies to plan a lot of anything.
Is the re -preparation possible?
Commercial deals, from a legal perspective, are also more than the appropriate trade agreements, which take months, if not years, to negotiate. Since they are not legally binding, commercial deals are not implemented, and the Trump administration does not have its own promises. Therefore, many companies, in the short term, warn against pledging large investments in expensive American factories and take years to build – and do not make the continuous changes of the United States an attractive investment destination.
However, even without a tariff, the re -preparation is a “foolish mission”, says Roberts. Returning something like iPhone to the United States would make it expensive. In a report in April, Dan Eve, in a report in April, estimated that the entire iPhone production in the United States would lead to three times the price of $ 1,000 to $ 3500.
The Trump administration may have tried to do so much quickly. “You want to start with a small tariff to indicate that you are serious, and the timetable that raises them to track the developing ability of American manufacturers to make these things a measure,” says FASTEAU.
From the start, technology companies have tried to prefer with the Trump administration to influence its policies. How many of this engagement is the product of the trade war and what it may accomplish is unclear. In mid -February, in anticipation of the upcoming Importing well -being, Apple promised to invest $ 500 billion in the United States over the next four years, bringing its Foxconn suppliers with it. Then in early March, Taiwan Manufacturing Company promised to manufacture semiconductors, a leading company in the world, by investing an additional $ 100 billion in its factory in Arizona.
If Trump’s tariff – in any way they they take – is not the best way to encourage us to manufacture, what can be?
Fasteau believes that the answer is more investment in automation. He says that the United States has greatly decreased in robots, compared to other manufacturing centers such as China and Germany. “Without investing in robots, I do not see widespread manufacturing economically applicable in the United States.”
But perhaps most importantly, the United States needs to determine the type of manufacturing it really wants. The answer, despite what Lutnick says, is likely to be the United States IPHONE factory.
“If American policy makers really want to manufacture iPhone in the United States, they must go to visit China,” Xing says, which implicitly means that it will be open-a bad way. “They must see the amount paid to workers and what are their working conditions – then they report a return to the United States.”
This article appears in June 2025: Asia’s release from luck With the title “Reviving US Tech is more difficult to manufacture than you think.
This story was originally shown on Fortune.com
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