Apple CEO Tim Cook, meanwhile, played Trump’s administration like a virtuoso. They discussed Apple’s plans to shift some iPhone production to the United States. Despite Trump’s insistence on domestic production, Cook focused on appeasing the president without committing to U.S.-based assembly of the popular devices.
At a recent announcement during the President’s State of the Union, Cook announced a $60 billion spending plan. Apple is committing to invest a total of $600 billion in the U.S. over the next four years. This strategy aims to bolster Apple’s relationship with the government while addressing Trump’s concerns about domestic manufacturing.
This is something that Trump has been clamoring for Apple to do for a long time now. He made clear this wish again in their recent colloquy. Cook clarified that while Apple manufactures many components in the United States, “the final assembly that you focus on, that will be elsewhere for a while.”
Amidst much documented happiness and smiles All Around, the meeting left Trump happy that Cook was specifically planning to invest in U.S. operations. “Oh, I’m so glad to hear you’re doing that,” the president said, showing approval for the amount of money they planned to propose.
The total value to the five-year investment is $625 billion, with Apple committing $125 billion annually beginning in February. With the recent announcement, this commitment will increase to $150 billion per year. This massive investment is likely to include investments in creating new jobs and addressing emerging technologies.
Indeed, Cook’s announcement makes no mention of plans to manufacture iPhones on U.S. soil. It does underscore Apple’s deep ties to American suppliers, most noticeably Corning, which supplies the glass used in the iPhones. Trump acknowledged this collaboration, stating, “He makes many of the components here, and we’ve been talking about it.”
Despite the lack of immediate plans for U.S.-based assembly, Cook’s announcement appears designed to mitigate potential repercussions from Trump’s proposed tariffs on semiconductor chips. Without mitigating measures, these tariffs have the ability to double the chip production costs. Meanwhile, Apple will be exempt from these tariffs. This exemption was important for the company, as it continues to navigate through trade policies implemented by the previous administration.
“Financial analyst Nancy Tengler had plenty of praise for Cook’s mastery of these negotiations. “What Tim Cook demonstrated in the first administration was a real savvy navigation of the treacherous waters,” she stated, highlighting Cook’s strategic approach to maintaining a favorable relationship with the government.
Contractual obligations require Apple’s suppliers to maintain an extreme level of secrecy about their business relationships. This requirement makes any switch in manufacturing strategies extremely difficult. That’s Trump’s ambition—to persuade Apple to do more of its manufacturing in the United States. So far, he has not come up with any specific plans.