Introduction:
When most people hear that Apple products are “Made in China,” they assume the bulk of the value, design, and engineering comes from there. But that’s far from the truth. Apple manufacturing network is one of the most complex and globally integrated systems in the world.
A recent report by Chip War author Chris Miller and Indian Administrative Service officer Vishnu Venugopalan, published by the American Enterprise Institute, lifts the curtain on Apple’s real supply chain.
Their findings reveal how U.S. tariff policies miss the mark by focusing on the wrong part of the process: final assembly.
techovedas.com/upto-100-us-hikes-tariffs-on-evs-semiconductors-from-china-amidst-upcoming-elections
5 Key Takeaways
China assembles most Apple devices but doesn’t control key components.
High-value parts come from Japan, Taiwan, South Korea, and the U.S.
Final assembly costs less than $10 per iPhone—just a tiny slice of total value.
India and Southeast Asia have entered the picture, but on a small scale.
U.S. tariffs target the wrong link in the chain—missing real economic leverage.
https://www.yolegroup.com/product/report/overview-of-the-semiconductor-devices-industry-h1-2025
The Real Role of China in Apple’s Supply Chain
Yes, your iPhone probably came off an assembly line in Zhengzhou or Chengdu. But final assembly is just the last step—and often the cheapest.
According to the AEI report, Chinese firms mostly perform lower-value tasks like putting components together, packaging, and logistics. These steps contribute less than 5% of the product’s value.
The real money—and the real technology—lies in components like the A18 chip (designed by Apple, fabricated by TSMC in Taiwan), the OLED display (mostly from Samsung or LG in South Korea), memory modules (from SK Hynix or Micron), and image sensors (Sony).
Even when these parts are built in China, they’re made in factories run by U.S., Taiwanese, Japanese, or South Korean companies, not Chinese firms.
techovedas.com/india-or-america-the-battle-behind-apples-global-production-strategy
India and Southeast Asia: Growing but Not Game-Changing
Apple has made headlines for shifting parts of its production to India and Vietnam, especially since U.S.-China tensions flared up. But Miller and Venugopalan say these moves are modest.
India now assembles some iPhones through Foxconn and Pegatron, while Vietnam handles AirPods and some iPad components. Yet the high-precision work—like printed circuit board fabrication, chip packaging, and CNC machining—still happens mostly in China or Taiwan.
In short: Apple is diversifying, but the depth of manufacturing hasn’t moved much.
techovedas.com/52-7-billion-chips-act-on-radar-will-trumps-plan-succeed
Why Tariffs Don’t Hit Where It Hurts
Under Trump and now possibly again in 2025, the U.S. has imposed tariffs based on where a product is assembled, not where it’s designed, engineered, or sourced.
That’s a problem.
Take the iPhone 15 Pro as an example:
| Component | Supplier Origin | Approximate Cost | Role in Supply Chain |
|---|---|---|---|
| Final Assembly | China/India | ~$10 | Low-value, labor-intensive |
| A18 Chip (SoC) | Taiwan (TSMC) | ~$130 | High-performance CPU/GPU |
| Display (OLED) | South Korea (Samsung) | ~$70 | High-quality visuals |
| NAND Flash Storage | U.S./SK Hynix | ~$50 | Data and OS storage |
| Image Sensor | Japan (Sony) | ~$30 | Camera quality |
Tariffs on final assembly affect a small portion of the product’s total value. They also don’t touch the advanced parts where the real economic and strategic power lies.
techovedas.com/donald-25-trumps-trade-war-epidemic-thats-shaking-the-global-market
What Should U.S. Policy Focus On?
Instead of targeting final assembly hubs, the U.S. should:
- Invest in chip manufacturing at home through acts like the CHIPS and Science Act
- Secure rare earth supply chains and critical minerals used in components
- Collaborate with allies like Japan, South Korea, and Taiwan on tech standards
- Incentivize U.S.-based production of high-value components like semiconductors and displays
This strategy would build real supply chain resilience and reduce dependence on geopolitical rivals.
techovedas.com/iphone-15-made-in-india-india-takes-a-bite-out-of-apples-china-production/
Conclusion: Apple’s Supply Chain Isn’t Just a China Story
The phrase “Made in China” oversimplifies Apple sophisticated, multinational manufacturing model. Yes, assembly lines operate in China—but most of the technology, value, and design happens elsewhere.
If Washington wants to truly address tech supply chain vulnerabilities, it must understand this complexity.
Tariffs on final assembly won’t reshape the global tech balance. Investment in high-value tech, smarter partnerships, and deeper supply chain visibility will.
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