Following sharp declines in Apple’s stock triggered by escalating US-China trade tensions, a report from Brazilian outlet Exame suggests Apple is considering shifting more iPhone production to Brazil. The change is said to be a reaction to increasing tariffs that put Apple’s China-centric production strategy at risk of becoming unviable.
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Apple May Shift More iPhone Production to Brazil as US-China Tariffs Hit Stock and Supply Chain
President Trump’s tariffs on Chinese imports are aimed at pushing companies to move production to the US by raising the costs of importing goods and pressuring foreign governments to lift trade barriers. China, in response, has imposed its own tariffs, creating a fraught situation for companies such as Apple, which lean heavily upon Chinese factories. Exame cites unnamed sources claiming Apple is exploring the benefits of Brazil’s lower export tariffs to the US. Apple already manufactures the base iPhone 16 model in Brazil, and this production could be further expanded.
While the report provides little detail, it does indicate that Brazil might be poised as a significant alternative site for Apple’s worldwide supply chain. The trade announcements have caused Apple’s market value to drop by more than $250 billion as investors reassess future revenue estimates as the cost of an iPhone rises in the United States.
The company’s heavy dependence on iPhone sales and the North American market deepens the impact — iPhones now make up 56 percent of Apple’s total sales, while North America alone accounts for 42 percent.
At this point, Apple’s newer iPhones are mainly assembled in China by Foxconn, its primary manufacturing partner. Though the imposed 54% tariffs on imports from China and another 28% on Indian goods are making this model difficult. Analysts at Raymond predict Apple may need to increase US hardware prices by up to 30% to offset the cost impact.
Apple shares have dropped 15.9% in total since the tariffs were announced, including a 7.3% fall today. Some analysts speculate that Apple may seek relief from the US government, given its significant investment in American job creation and infrastructure.
FAQs
Why is Apple considering Brazil for iPhone production?
To avoid high US-China tariffs and lower export costs.
Does Apple already make iPhones in Brazil?
Yes, it produces the base iPhone 16 model there.
