Apple is exploring options to expand its iPhone production in Brazil as a strategic move to navigate around newly announced US tariffs on imports from China and other countries.
The tech giant, which currently manufactures the base iPhone 16 model in Brazil, is evaluating increasing its production capacity in the South American nation, according to sources familiar with the matter cited by Brazilian magazine Exame.
This potential expansion comes in response to President Trump's recent announcement of extensive tariffs on imports, with China facing a steep 54% rate. The news has severely impacted Apple's stock, which dropped over $250 billion in market value following the tariff announcements.
The tariffs pose a particular challenge for Apple, as North America represents 42% of the company's sales, with iPhones accounting for 56% of total revenue. Currently, most of Apple's flagship smartphones are manufactured in China by Foxconn.
Market analysts estimate that Apple might need to increase US hardware prices by up to 30% to offset the impact of the China tariffs. The iPhone 16 Pro Plus could see prices jump from $1,599 to $2,300 under the new tariff structure.
By expanding production in Brazil, Apple could benefit from lower tariff rates on Brazilian exports to the US. However, the company has not officially confirmed these plans, and details about the scope of potential expansion remain unclear.
The move reflects a broader trend of companies reevaluating their manufacturing strategies in response to the new US trade policies. The baseline 10% tariffs are scheduled to take effect on April 5, with reciprocal tariffs following on April 9.