Have you ever wondered why a quintessential American brand like Apple continues to manufacture its iPhones in China, even in the face of rising geopolitical tensions and trade disputes? While it’s often assumed that companies choose China for its cheap labor, Apple’s CEO Tim Cook has debunked this notion in a resurfaced viral video that’s shedding new light on the tech giant’s manufacturing strategy.
In a 55-second clip from 2024, Tim Cook clarifies that the decision to build iPhones in China isn’t driven by lower labor costs. “It’s a common misconception that companies go to China because labor is inexpensive. That’s not true anymore,” Cook explained.
According to him, the real advantage lies in China’s unparalleled manufacturing ecosystem and deep pool of skilled labor—particularly in high-precision tooling and advanced material handling. These are key components in assembling the high-tech devices that Apple is known for.
Cook elaborates, “The tooling skills available in China are incredibly advanced. If you tried to hold a meeting of tooling engineers in the U.S., you might not even fill a room. But in China, you could fill multiple football fields.”
This abundance of specialized talent is one of the biggest reasons Apple continues to lean on Chinese factories. China has built a comprehensive ecosystem that includes not just factories, but also suppliers, engineers, and logistics networks that are hard to replicate elsewhere.
Despite calls from former U.S. President Donald Trump and other leaders urging American companies to bring manufacturing back home, Apple hasn’t made any substantial moves in that direction. According to a Bloomberg report, the U.S. still lacks the scale, facilities, and skilled labor required for high-volume tech manufacturing. Moreover, the supplier ecosystem that Asia, particularly China, offers is still unmatched globally.
However, things are slowly changing. Apple is increasingly looking toward India as a way to diversify its manufacturing operations and reduce reliance on China. The company’s suppliers are currently building what will become the world’s second-largest iPhone manufacturing plant in India.
In the 12 months ending in March, Apple manufactured iPhones worth $22 billion in India—a 60% jump from the previous year. This significant shift highlights Apple’s growing interest in the Indian market, not just for sales but also for production.
Apple’s choice to stick with Chinese manufacturing isn’t about cutting corners—it’s a calculated decision based on supply chain efficiency, technical expertise, and workforce capabilities. As the global tech landscape evolves, we may see India stepping in as a new hub, but for now, China remains irreplaceable.
