Apple To Invest $500 Billion In US, But Not For iPhones, iPads Or Macbooks

Apple Inc has announced that it will invest $500 billion in the United States over the next four years of Donald Trump's presidency. The announcement has come days after Apple CEO Tim Cook met US President Donald Trump. What is interesting however, is that the focus will not be on manufacturing iPhones, iPads, and Apple Macs (laptops) - those will continue to happen in China, Taiwan, Vietnam, and India.

ARTIFICIAL INTELLIGENCE

Apple, which has its own artificial intelligence or AI platform - Apple Intelligence - will be the primary focus of this investment. For this the tech giant plans to set up a gigantic factory in Texas, where its AI servers will be manufactured.

RESEARCH JOBS

Apple also aims to create more than 20,000 research and development jobs across the US within four years.

SOURCING COMPONENTS

Besides Apple Intelligence, the $500 billion investment will also be used to purchase components and parts from other US suppliers. This includes firms such as Corning, which manufactures glass panels for iPhones.

APPLE TV+

The massive investment will also be used by the company to expand its Apple TV+ service headquartered in the US. New television shows, originals, and movies based in America will be funded from the overall investment.

SEMICONDUCTOR MANUFACTURING

The company also has big plans for semiconductor manufacturing - for which it majorly depends on Taiwanese firm Foxconn. The company had revealed last month that it has already started mass production of chips of its own unique design. This is being done at a factory owned by Taiwan Semiconductor Manufacturing Company in the state of Arizona.

Bringing the Taiwanese firm to Arizona and helping introduce legislation that later went on to become the CHIPS Act to bolster US semiconductor production were two of Donald Trump's biggest industrial policy moves during his first term.

Apple has now announced that it will work with Foxconn, formally known as Hon Hai Precision Industry, to build a massive 250,000-square-foot facility in Houston, where it will assemble servers that go into data centers which will power Apple Intelligence, its suite of AI features that help draft emails and perform many other tasks. Those servers are currently made outside of the US.

SKILL ACADEMY

Skill development will be a key focus area for the US tech giant , which aims to utilise part of the $500 billion investment to open a manufacturing academy in Michigan, where its engineers and academic staff will offer free courses to upskill workers at small and medium manufacturing facilities. Courses will include programs such as project management, skill training, factory operations, and manufacturing process optimisation.

WHAT HAPPENS TO iPHONES AND iPADS AMID TARIFF THREATS?

Apple's devices, such as iPhone, iPad, and Macbook shall continue to be manufactured and assembled in China, Taiwan, Vietnam, and India. Besides Donald Trump's reciprocal tariffs, his previously announced levy on imports from China will face a 10 per cent tariff upon landing on US shores.

It is unclear whether Tim Cook has been able to persuade Donald Trump for an exemption for iPhones manufactured abroad. Or whether the $500 billion investment pledge is a way to circumvent such punitive tariffs.

After his meeting with Apple CEO Tim Cook, Donald Trump wrote on his social media platform Truth Social, thanking Apple and its CEO for the massive pledge. This, he said, reflected Apple's faith in the Trump Administration, he asserted.

Apple's stock has gained by 1.2 per cent since the announcement on Monday (US time).

(Inputs from Reuters)