Canalys: India's exports of iPhones to the U.S. surged by 76%, but Apple's supply chain strategy still faces challenges

According to the Zhitong Finance APP, data from Canalys shows that in April, the number of iPhones exported from India to the United States increased by 76% year-on-year, reaching 3 million units. This growth coincides with Apple's (AAPL.US) acceleration of its "Made in India" plan. In contrast, the number of iPhones exported from China to the United States during the same period decreased by approximately 76% year-on-year, down to 900,000 units. Omdia stated that its estimates for smartphones include customs records and channel data from iPhone distributors. Omdia research manager Le Xuan Chiew noted that the data for April indicates that Apple has taken proactive measures to respond to the tariffs imposed by the U.S. on China, as most of Apple's iPhones are produced in China. He stated, "Apple has long been working to cope with the trade war." He added that Apple began heavily investing in India's supply chain during the COVID-19 pandemic. According to Omdia's estimates, in March this year, India's iPhone shipments to the U.S. also surpassed those from China. This trend occurred before Trump announced the imposition of so-called "reciprocal tariffs" on April 2. Chiew mentioned that the unusually high shipments that month seemed to be a result of the company stockpiling. On April 11, the Trump administration decided to exempt iPhones and other consumer electronics from reciprocal tariffs, but this did not reverse the trend, as Apple CEO Tim Cook reiterated in early May that most iPhones sold in the U.S. would be manufactured in India. Under Trump's current tariff policy, iPhones imported from China still face an additional 30% tariff, while the benchmark tariff rate for most other countries, including India, is currently 10%. 2025 iPhone export volume from China and India to the U.S. Indian shipments may slow down Chiew from Omdia stated that although the significant growth in iPhone shipments from India in March and April demonstrates the adaptability of Apple's supply chain, this growth is expected to slow down for the remainder of the year. He said, "The growth rate of India's manufacturing capacity is not expected to meet the entire demand from the U.S. It is still too early." He also mentioned that Apple has recently begun shipping the latest iPhone 16 Pro. Omdia estimates that the demand for iPhones in the U.S. is about 20 million units per quarter, and India is not expected to reach this level until 2026. Meanwhile, Daniel Newman, CEO and chief analyst of research firm Futurum Group, stated that shipments reflect the situation of final assembly but do not represent the entire supply chain and manufacturing process. He added that the vast majority of assembly processes still take place in China. "Made in India" plan faces resistance Analysts say that trade protectionism measures may hinder India's ability to expand iPhone production capacity. Newman stated that while it is wise for Apple to do this, it is also playing a "dangerous game" with Trump. Last Friday, Trump stated that he would impose a tariff of at least 25% on iPhones not produced in the United States and reiterated his desire for iPhones sold in the U.S. to be made domestically, "not in India or anywhere else." Dan Ives, the global technology research head at Wedbush Securities, noted that Apple's plans in India will face some challenges in logistics, distribution, and complex supply chain operations. However, under the tariff situation, India is still expected to be Apple's "lifeline." He said, "In our view, producing iPhones in the U.S. is simply a pipe dream, and Apple will continue to deepen its efforts in India. Cook will seek to negotiate with Trump, but India will remain the focus, and that won't change."