Apple has announced plans to spend $500bn (£400bn) and hire 20,000 additional staff in the United States, as it seeks to protect itself from the impact of President Donald Trump’s latest tariffs targeting goods made in China.
Tim Cook, Apple’s chief executive, revealed the four-year initiative following a meeting with Mr Trump at the White House. The scheme includes building a new manufacturing facility for advanced servers in Houston, Texas, boosting its streaming TV production capacity, and acquiring microchips made in Arizona by Taiwanese supplier TSMC.
The iPhone maker has long assembled the majority of its products in China, putting it at risk from Mr Trump’s escalating trade dispute with Beijing. The US president has imposed a 10 per cent surcharge on all Chinese imports, while China has responded with its own measures, including a possible restriction of rare earth metals essential to electronics manufacturing.
Mr Trump also claimed last week that Apple would move some operations from Mexico to the US in response to his threat of tariffs on Mexican goods. Despite Apple having no major presence in Mexico itself, one of its key manufacturing partners, Foxconn, has reportedly been expanding there.
Apple’s $500bn commitment includes everyday operations, supplier partnerships and office expansions, which the company says constitute its largest-ever US investment. “We are bullish on the future of American innovation,” said Mr Cook. “We’re proud to build on our long-standing US investments with this $500bn commitment to our country’s future.”
As part of the announcement, Apple will create a 250,000 sq ft facility in Houston for the production of high-end servers previously made abroad, as well as ramping up its chip orders from TSMC’s Arizona plant. These moves could protect Apple from import duties on Chinese-made goods, but some analysts also see them as strategic gestures to keep the Trump administration on side.
In Mr Trump’s first term, Apple secured various tariff exceptions after pledging to boost its American manufacturing footprint, including assembling the latest generation of its desktop computer within the US. Mr Cook contributed $1m to Mr Trump’s inauguration fund and attended alongside other major tech leaders.
Apple says most of the 20,000 new US jobs will be created in research and development and artificial intelligence. However, analysts caution that Apple’s dealings with the White House could prove problematic in China, where authorities are said to be exploring an investigation into the company’s App Store fees. Beijing has already taken action against other US-based firms, leading to speculation that Apple could soon face scrutiny, although it has so far avoided retaliation.
Last week, Apple made headlines in Britain by withdrawing its highest level of data privacy protection for users, rather than complying with a reported secret Government demand to install a ‘backdoor’ system. The Home Office order prompted concern in Washington, where lawmakers are pushing to outlaw compliance with foreign government requests that weaken encryption.
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Apple unveils $500bn US investment drive to circumvent Trump’s China tariffs