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Apple is preparing to add a further $100bn to its US investment plans as chief executive Tim Cook strives to insulate the iPhone maker from Donald Trump’s trade war.
White House officials said that the Silicon Valley giant’s expanded $600bn spending commitment would be announced later on Wednesday, including a new “American manufacturing programme” to produce more of its devices and components in the US.
The pledge comes as a new wave of the US president’s planned tariffs is set to come into force on Thursday.
“President Trump’s America First economic agenda has secured trillions of dollars in investments that support American jobs and bolster American businesses,” said Taylor Rogers, the White House press secretary. “Today’s announcement with Apple is another win for our manufacturing industry that will simultaneously help reshore the production of critical components to protect America’s economic and national security.”
On the company’s earnings call last week, Cook said that the “vast majority” of Apple’s products were covered by the US administration’s ongoing Section 232 investigation into potential tariffs on chips and the products that contain them. The results of that investigation are expected soon.
Apple did not immediately respond to a request for comment. Its shares were up nearly 4 per cent on Wednesday morning following the news.
In February, Apple said it planned to hire an additional 20,000 staff in the US over the next four years, as part of a $500bn investment in the country during Trump’s second term in office.
That figure included Apple’s day-to-day spending on US suppliers, data centres and corporate facilities, as well as new initiatives such as a manufacturing facility in Houston to build servers for artificial intelligence. In 2018, during Trump’s first term, Apple had pledged to make a $350bn “direct contribution” to the US economy.
In July it further announced a $500mn commitment to building US rare earth magnets with MP Materials, as part of the same investment plan.
Among US Big Tech companies, Apple is especially exposed to the Trump administration’s trade policies. Its efforts to diversify its production away from China to India have angered Trump, who has threatened Apple with extra tariffs unless it moves iPhone manufacturing to the US.
But supply chain experts have said the US, which hasn’t produced smartphones in any meaningful volumes for more than a decade, lacks the manufacturing expertise to assemble a device as sophisticated as an iPhone.
Moving production of its products to the US will eat into Apple’s margins, which are kept high thanks to its deeply rooted supply chains in Asia.
Apple has warned of $1.1bn in tariff-related costs in the quarter to September, assuming the current tariff rates do not change. At the same time, Apple’s sales in its most recent quarter were boosted by US consumers trying to get ahead of the new levies, which could lead to price increases for Apple’s products.
Hundreds of billions of dollars have been wiped from Apple’s market capitalisation since Trump’s “liberation day” announcements in April, amid wider concerns that the iPhone maker is falling behind in AI.
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