Trump says Apple will build three 'big' new plants in US

Nettie James
July 28, 2017

In a recent interview, President Trump claims that the company has finally promised to bring some of those manufacturing jobs to Americans by building three plants. In November, the then president-elect said he spoke with Cook and asked him to bring more of the company's manufacturing to the country. It is also not known if Trump was talking about Apple-owned plants, or plants with investment help from Apple. Foxconn, the Taiwanese company that assembles iPhones under contract with Apple, is scouting for locations to build a USA factory, and Mr. Trump was expected to announce one on Wednesday.

In May, Cook said in an interview with CNBC that it will invest $1 billion to create manufacturing jobs in the United States.

As Bloomberg points out, Apple doesn't build or manage factories; instead, it operates an intricate Asian network of production. In the entire world, Apple now owns exactly one manufacturing plant: its plant where it assembles iMacs in County Cork, Ireland. Apple CEO Tim Cook said in May that Apple intends to create a fund with $1 billion in it meant exclusively for investing in U.S. companies that are involved in advanced manufacturing operations.

The tech giant has resisted the idea of bringing the cash home, because the U.S. tax code allows multinational firms to defer profits while they are held overseas but taxes income at up to 35 percent when repatriated.

Building Apple factories in the US could have some big positives for AAPL stock.

Aside from the cheaper costs of labor, there is also the matter of shielding itself from risks of defective parts that makes Apple more enthusiastic about foreign manufacturing. The tech giant uses several US companies to manufacture hardware parts, while iPhones are assembled in China. It has claimed to have created close to 2 million jobs, out of which 80,000 are in the U.S. while the rest of those figures are contributed by its developers and suppliers.

Other reports by Insurance News

Discuss This Article