POTUS’ Comments on U.S. Factories Make It Awkward for Apple – Tripp Mickle Updated July 27, 2017 4:41 p.m. ET


In May interview, Apple’s Cook indicated the company was unlikely to shift product assembly to the U.S.

Apple outsources most of it manufacturing to contractors overseas, mostly  in China, including to the Foxconn Technology Group. Above, a Foxconn production line in Shenzhen, China.

Apple outsources most of it manufacturing to contractors overseas, mostly in China, including to the Foxconn Technology Group. Above, a Foxconn production line in Shenzhen, China. Photo: Thomas Lee/Bloomberg News

Pressed by President Donald Trump, Apple Inc. AAPL -1.89% suddenly faces new pressure to build factories in the U.S., something it hasn’t done for years and has shown no signs of wanting to do.

Mr. Trump’s statement that Apple plans to build three big plants in the U.S. has rekindled scrutiny of the company’s policy of outsourcing of almost all of its manufacturing to contractor factories overseas—mainly in China.

Mr. Trump had needled the iPhone maker over that issue during the 2016 presidential campaign. He had said little about it publicly since taking office, however, until an interview Tuesday with The Wall Street Journal, in which he said Apple Chief Executive Tim Cook had told him the company planned to build the plants in the U.S.

The pressure threatened to grow on Apple with the announcement Wednesday by the head of Foxconn Technology Group, Apple’s largest contract manufacturer, that it plans to invest $10 billion in a display-panel factory in Wisconsin. Foxconn made the announcement at a White House ceremony with Mr. Trump. A senior White House official told reporters the plant wasn’t among the three potential Apple facilities to which the president had referred.

The White House didn’t respond Thursday to requests for additional comment about Mr. Trump’s remarks. Apple has declined to comment.

The episode is the latest example of the complex relations between the White House, which is pushing to rebuild U.S. manufacturing, and corporate America, which for years has been adding more jobs overseas. The tension has put companies such as Carrier Corp. and Ford Motor Co. in Mr. Trump’s crosshairs, though the White House also has proposed policies welcomed by many companies, including proposed cuts to corporate taxes.

Carrier, which faced criticism from Mr. Trump over a plan to shift production to Mexico, said in November it would keep about half the jobs in Indiana that it had planned for Mexico. Ford, which drew Mr. Trump’s criticism over plans to shift compact-car manufacturing to a new plant in Mexico, said in January it would cancel the plant and allocate $700 million in savings to create jobs at a Michigan plant. Last month, it said it would produce compact cars for the U.S. in China.

Apple today has only one plant of its own—in Cork, Ireland. Its contract manufacturers operate two small U.S. plants, in Austin, Texas and Fremont, Calif. Those facilities have never grown beyond their narrow role making Apple’s Mac Pro computer, a niche product that sells for $3,000 or more.

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