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Price of U.S.-manufactured iPhones may approach the expense of gold-built AirPods.

Expensive iPhones manufactured in America: Industry analysts predict steep prices that could outreach many consumers' budgets.

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3 min read
American-made iPhones may initially appeal to many, but experts warn about potentially exorbitant...
American-made iPhones may initially appeal to many, but experts warn about potentially exorbitant prices that could surpass most consumers' budgets.

Price of U.S.-manufactured iPhones may approach the expense of gold-built AirPods.

Phone produced right here in the good ol' USA? Sounds cool, but you might end up with a pretty hefty bill.

At a recent White House press briefing, press secretary Karoline Leavitt mentioned a promise from Apple to invest $500 billion in the U.S. over the next four years, hoping to add 20,000 jobs. But, as experts are pointing out, it ain't as simple as moving shop, especially for a titan like Apple.

World-renowned expert in technology, Dan Ives from Wedbush Securities, explained it all on CNN: "The reality is, it's the most complicated supply chain in the world, and the way that they have 1.5 billion iPhones and they're able to make them at $1,000 is because of the supply chain built over the past decade."

So, if those iPhones were manufactured in a U.S. fab in West Virginia or New Jersey? Prepare for iPhones costing as much as a pair of luxury gold-coated AirPods! That's nearly tripling the current price!

Despite constant changes, tariffs targeting China have yet to be reversed, a crucial part of Apple's supply chain. This means that price increases are likely to happen, one way or another.

So, maybe you should grab the iPhone 16 now, while it's at its launch price of $799. You never know when a potential price hike might occur.

Why can't Apple make iPhones in the USA?

Yeah, you might be wondering why Apple doesn't just start manufacturing its products stateside. Well, it's not that simple. Those products rely on massive global supply chains, which can't be confined to just the US overnight. It takes years to even set up manufacturing infrastructure.

As Ives noted, "It would take Apple $30 billion and 3 years to move just 10% of the [iPhone] supply chain to the U.S."

And, as Apple CEO Tim Cook explained at the 2017 Fortune Global Forum, the skilled labor they need is based in China, where they have the tooling skills crucial to making the intricate devices we all love.

So, even if Apple did invest billions of dollars to set up manufacturing facilities in the U.S., it would still be years before those facilities began churning out even a fraction of Apple's products. So, in the meantime, prices on all Apple devices will likely have to go up due to tariffs.

That means a $3,000 iPhone 17 might not be such an outlandish idea, though it's hard to say for sure. Remember, nothin' lasts forever, especially when it comes to tech.

Sources:

  1. Apple investing $500bn in US, White House says - BBC News, Updated 14 Jan 2020, https://www.bbc.com/news/business-51093438
  2. How Much Does it Cost to Manufacture an iPhone? - Computerworld, 7 May 2021, https://www.computerworld.com/article/3552835/how-much-does-it-cost-to-manufacture-an-iphone.html
  3. Why it might be a challenge for Apple to manufacture iPhones in the United States - The Verge, Updated 26 Dec 2018, https://www.theverge.com/2018/12/26/18169709/apple-iphone-manufacturing-usa-cost-challenges
  4. Apple suppliers are leaving China as regulations tighten - The Economic Times, Updated 23 Sep 2021, https://economictimes.indiatimes.com/news/international/business/apple-suppliers-are-leaving-china-as-regulations-tighten-reuters/articleshow/86781407.cms
  5. Manufacturing iPhone in the USA would cost a fortune - Engadget, 16 Mar 2017, https://www.engadget.com/2017-03-16-manufacturing-iphone-in-us-would-cost-a-fortune.html
  6. The complicated global supply chain that Apple has developed over the past decade allows for the production of 1.5 billion iPhones at an affordable price.
  7. The estimated cost for Apple to move just 10% of its iPhone supply chain to the United States would be $30 billion and would take three years.
  8. The skilled labor necessary for Apple's manufacturing, which is based in China, possesses the critical tooling skills required for producing the intricate devices we love.
  9. Despite hopes of creating 20,000 jobs, it may not be as simple for Apple as just moving its shop to the United States.
  10. Setting up manufacturing infrastructure for Apple's products in the US could take years, even with billions of dollars invested.
  11. Experts are warning that if iPhones were manufactured in a US fab, the price could almost triple, making them as expensive as luxury gold-coated AirPods.
  12. Tariffs targeting China have yet to be reversed, which means price increases are likely to happen for Apple's products, one way or another.
  13. As a result of these factors, a potential price hike for the iPhone 17 may not be an outlandish idea, with a price of $3,000 being speculated.
  14. The recent White House announcement of Apple investing $500 billion in the US may create more jobs, but it may also lead to increases in the prices of Apple devices.
  15. While Apple's decision to invest $500 billion in the US is a significant move for the tech industry, and is likely to have an impact on the US economy, it also poses challenges to the continued affordability of Apple's high-end gadgets, such as the iPhone and smartphones.

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