Shifting iPhone production to the United States could drive costs significantly higher for Apple (NASDAQ: AAPL), according to a new research note from Bank of America. While technically feasible, relocating final assembly domestically would create major logistical and financial hurdles for the tech giant.
Bank of America estimates that moving the final assembly of the iPhone 16 Pro Max to the U.S. would increase costs by approximately 25%, primarily due to higher labor expenses. If reciprocal tariffs were imposed on imported components and sub-assemblies, overall costs could rise by more than 90%.
To make such a move viable, Apple would need tariff waivers on globally manufactured parts, the note said.
While Apple has not indicated any immediate plans to shift manufacturing stateside, the discussion comes amid broader scrutiny of global supply chains and renewed focus on domestic production incentives. Still, BofA does not expect any near-term changes to Apple’s current manufacturing footprint.
The firm outlined several potential strategies Apple could use to manage the risks of rising production costs. These include increasing iPhone manufacturing in countries like India, renegotiating supplier contracts, adjusting product pricing, and potentially moving to a longer iPhone release cycle—such as every two years—to ease supply chain pressures.
Over the long term, increased automation and robotics in assembly lines could help offset labor-related cost increases, BofA added.
Apple (NASDAQ: AAPL) continues to diversify its supply chain, with a growing focus on India as a key manufacturing hub. While domestic assembly remains a long-term consideration, cost pressures and global trade dynamics remain critical factors in shaping the company’s strategy.
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