Investor Dan Ives thinks the idea of Apple moving iPhone manufacturing back to the US is unrealistic, calling it a “Pinocchio story.” He shared his views in a recent CNBC interview.
Why Ives Thinks It’s Unlikely
Ives points out that Apple has cleverly diversified its manufacturing by establishing a base in India. This helps reduce reliance on China. However, with the threat of hefty tariffs on iPhones made outside the US, Apple investors are facing a tough situation. Ives believes it’s simply not feasible for Apple to completely overhaul its global supply chain.
He estimates that shifting even 15-20% of the supply chain to the US would take four to five years and cost a staggering $20 to $30 billion. Furthermore, manufacturing iPhones in the US would likely lead to a massive price hike, potentially pushing the cost of an iPhone to a whopping $3,500.
India as a Strategic Move
Ives highlights that Apple’s move to India was a smart strategic decision. Now, with the pressure to return manufacturing to the US, Ives feels Apple is in a difficult position. He describes the situation as a “Twilight Zone” day for Apple investors, given the company’s efforts to move away from China and now facing this new challenge. The demand to bring production back to the US, he believes, is simply unrealistic.
