Made-in-India iPhones Still Cheaper in the U.S. Despite Proposed Tariff

Indian-Made iPhones Cost Less in U.S. Even Amid Tariff Talks

Written by: Supriya Kadu

Edited by: Pinky Deshmukh

Last Updated: May 24, 2025

Summary: Even with a proposed 25% U.S. import tariff, iPhones made in India remain significantly more affordable than manufacturing them in America.

Apple's decision to manufacture iPhones in India remains a wise financial strategy, even with the U.S. imposing a significant 25% import tax. A report from the Global Trade Research Initiative (GTRI) indicates that manufacturing iPhones in India is still much cheaper than doing so in the United States.

The report explains that assembling an iPhone in India costs around $30. In contrast, if Apple were to produce the same phone in the U.S., it would cost about $390, mainly due to the high labor costs. Indian workers earn roughly $230 a month, while their American counterparts make about $2,900.

Even if the proposed 25% tariff—about $250 on a $1,000 iPhone—is added to the Indian manufacturing cost, the total still amounts to just $280. That’s significantly lower than the $390 it would cost in the U.S.

The report also breaks down the value distribution of an iPhone. Apple keeps the largest share—around $450—for its brand, design, and software. Other contributions come from U.S. component suppliers ($80), Taiwan ($150), South Korea ($90), Japan ($85), and smaller parts from Germany, Vietnam, and Malaysia ($45). China and India, despite being the main assembly points, earn only around $30 per unit.

Thanks to India’s Production-Linked Incentive (PLI) scheme, Apple benefits from additional government incentives, making Indian manufacturing even more cost-efficient.

In short, even with added tariffs, Apple saves more by sticking to Indian manufacturing than by relocating production to the U.S.