President Donald Trump has argued that slapping higher tariffs on Chinese goods exported to the United States would bring jobs back to this country–if China didn’t agree to a new trade deal–as companies moved factories in order to avoid the higher tariffs.
According to a report today from Japan’s Nikkei, however, companies that supply Apple (AAPL) are indeed thinking about moving production lines from China–but not to the United States. The “what-if” exercises look to calculate the costs of moving 15% to 30% of manufacturing to Southeast Asia from China.
The Nikkei story says Apple has asked major suppliers such as iPhone assemblers Foxconn Technology, MacBook maker Quanta Computer, and iPad producer Compal Electronics to run the numbers for such a move.
Two of those companies have pushed back on the Nikkei story with both saying that Apple has not asked for cost estimates for shifting production out of China. Taiwan’s Hon Hai Precision Industry, who as FoxConn is a primary iPhone manufacturer and the largest private employer in China, said that it has enough capacity to make all U.S.-bound iPhones outside of China, according to Bloomberg.
“Twenty-five percent of our production capacity is outside of China and we can help Apple respond to its needs in the U.S. market,” Hon Hai semiconductor division chief Young Liu told investors in Taipei last week. “We have enough capacity to meet Apple’s demand.”