In a significant strategic shift to navigate escalating U.S. trade tariffs, Apple is expanding its iPhone assembly operations in Brazil, partnering with Foxconn at its Jundiaí facility.
This move, as initially reported by Brazilian outlet Exame is primarily aimed at circumventing new, hefty U.S. duties on products manufactured in China and India , which could otherwise lead to price hikes of up to 40% for American consumers on some iPhone models. The development underscores Apple’s proactive measures to de-risk its supply chain and protect profit margins in a volatile geopolitical landscape.
The decision to bolster Brazilian production is a direct response to a new U.S. tariff regime announced on April 2 which employs a controversial formula. This Brazilian expansion is a key part of Apple’s broader strategy to diversify manufacturing beyond its traditional Asian strongholds, aiming to use the Jundiaí plant as an export hub to the U.S. market.
Even before the formal tariff announcement, Apple undertook an emergency airlift of iPhones from China and India in late March 2025, a maneuver involving five cargo planes over 72 hours. This costly operation, internally dubbed a “shock and awe” strategy” aimed to land products stateside tariff-free.
The prospect of higher prices also reportedly led U.S. consumers to rush iPhone purchases. Further corroborating the Brazil expansion, unnamed local supply chain sources told Valor Econômico that “Sources from the local supply chain indicate that Foxconn in Jundiaí is adapting assembly lines with a focus on exports, a strategic move by Apple to circumvent the new American tariff barriers.”
Navigating Tariffs And Trade Tensions
Apple’s move into Brazil is not an isolated event but part of a larger, ongoing diversification. The company aims to manufacture up to 25% of its iPhones in India by 2027, a substantial increase detailed by the Financial Times. Apple also intends to double its annual iPhone production in India to over 80 million units.
The Foxconn facility in Jundiaí already assembles base models of the iPhone 13, 14, and 15, and recently gained Anatel approval for the iPhone 16 base model, though more advanced models like the Pro and Pro Max are still imported into Brazil. While Foxconn operates under a special tax regime in Brazil, this has not historically translated to significantly lower iPhone prices within the country itself, suggesting the current expansion is primarily export-focused.
Weighing Options: Brazil As A Strategic ‘Pressure Valve’
The intensified focus on Brazil comes as the Trump administration advocates for more U.S.-based tech manufacturing. White House Press Secretary Karoline Leavitt stated the administration believes the U.S. has the necessary labor and resources, pointing to Apple’s $500 billion U.S. investment plan as a sign of the company’s confidence.
Commerce Secretary Howard Lutnick, in a CBS News appearance, painted a picture of highly automated U.S. factories taking over iPhone assembly. President Trump also confirmed meeting Apple CEO Tim Cook around February 20th regarding Apple’s U.S. investments, where Cook highlighted Apple was “bullish on the future of American innovation, and we’re proud to build on our long-standing U.S. investments with this $500 billion commitment to our country’s future.”
During Lutnick’s swearing-in, he pointed to Apple’s previous $430 billion U.S. investment plan from 2021, and commitment to “doubling our Advanced Manufacturing Fund, to building advanced technology in Texas”, saying “we’ll keep working with people and companies across this country to help write an extraordinary new chapter in the history of American innovation.”
However, Apple executives have long expressed skepticism about replicating their vast Asian manufacturing ecosystem in the U.S., primarily citing a shortage of specialized engineering talent. Steve Jobs famously told President Obama that the required number of engineers was not available stateside, “You can’t find that many in America to hire,” a point detailed in Walter Isaacson’s biography.
Tim Cook, in 2017, specifically highlighted the scarcity of tooling engineers in the U.S. compared to China. Apple’s current $500 billion U.S. investment focuses more on AI data centers, like a new facility in Texas, and R&D, rather than final iPhone assembly.
Tech analyst Carolina Milanesi from Creative Strategies, in an interview with Tech Mundo, suggested that while using Brazil might offer a temporary tariff workaround, Apple would face logistical hurdles and potentially higher labor costs. She characterized the Brazil strategy as more of a shortt term workaround than a full-scale replacement for Asian production.
Uncertainty And High-Level Discussions
The tariff landscape remains fraught with uncertainty, further complicated by conflicting messages from the U.S. administration regarding potential exemptions for electronics. This led Wedbush analyst Dan Ives to describe the situation as creating “massive uncertainty and chaos for companies trying to plan their supply chain, inventory, and demand.”
Amidst this, Apple CEO Tim Cook reportedly held direct discussions with Commerce Secretary Lutnick during the week of April 7th concerning the tariff impact. This engagement is reminiscent of actions during Trump’s first term when, as noted by Time, a significant U.S. investment announcement by Apple coincided with the iPhone receiving an exemption from then-active tariffs on Chinese goods.
