Can Apple produce its products at home?

‘Designed by Apple in California Assembled in China’ is engraved on most Apple products. Design which is the most important part of a product’s production process is made in the USA; however, the majority of the parts is produced outside the USA. The US President Trump is asking Apple to produce its products at home. How likely is Trump’s proposal to be true?

Apple’s suppliers are all over the world and some are significantly large companies which support their countries’ economies. If Apple does not renew their contracts, not only these companies will be hurt and even face bankruptcy, also the economies which depend on these companies will be hurt and even face recession as well. Therefore, Trump’s proposal is a huge threat to the emerging markets, Apple’s 1 trillion dollar market value exceeds some emerging markets already. However, these countries which have some degree of dependence on Apple’s orders will strongly oppose Trump’s trade policy. In addion, Apple may not like this idea. The labour cost in the US is much higher than the labour costs in the emerging markets that if Apple changes to use American suppliers, its costs will increase dramatically. In addition, changing suppliers will affect production efficiency. The current suppliers have produced Apple’s parts for years, they are experienced suppliers who can produce more efficiently. Once Apple switches its suppliers, the production efficiency will decrease, this will affect Apple’s supply chain and cause a huge problem for Apple.

Therefore, Trump’s proposal is just a proposal or a threat, it won’t come trune.