Apple announced Monday it would invest $500bn in the US in the next four years that would include a giant factory in Texas for artificial intelligence servers and add about 20,000 research and development jobs across the country.
The move comes on the heels of reports that the Apple CEO, Tim Cook, met Donald Trump last week. Many of Apple’s products that are assembled in China and imported to the US could face 10% tariffs introduced by the White House earlier this month, though the iPhone maker secured some waivers from China tariffs during the first Trump administration.
It is not the first time the iPhone-maker has made a splashy announcement about a multibillion-dollar investment in the US economy during a Trump administration. In 2018, during the first Trump administration, Apple said its new and ongoing investments would contribute $350bn to the US economy over five years.
This new injection of $500bn in expected spending includes everything from purchases from US suppliers to US filming of its television shows and movies for its Apple TV+ service. The company declined to say how much of the figure it was already planning to spend with its US supply base, which includes firms such as Corning that makes glass for iPhones in Kentucky.
Trump, in a Truth Social post, thanked Apple and Cook, saying the move reflected the company’s faith in his administration.
Though some of Apple’s components are made in the US – such as chips from manufacturers such as Broadcom, Skyworks Solutions and Qorvo – most of Apple’s consumer products are still assembled outside the US, particularly in China. A 10% tariff could drastically increase the cost of Apple’s flagship product, the iPhone, on its home turf.
Apple said it last month started mass-producing chips of its own design at an Arizona factory owned by Taiwan Semiconductor Manufacturing Co (TSMC). “Apple is the largest customer at this state-of-the-art facility, which employs more than 2,000 workers to manufacture the chips in the United States,” the blog post announcing the investment read.
Bringing TSMC – which produces an estimated 90% of the most advanced semi-conductors in the world – to Arizona and helping introduce legislation that later became the Chips Act to bolster US semiconductor production were two of Trump’s biggest industrial policy moves during his first term. Now, Trump is reportedly planning on issuing changes to the Chips Act signed under the Biden administration, which promised $30bn in subsidies to manufacturers planning to build chips factories in the US. But Trump said he did not believe these companies, such as TSMC, needed money, but rather they needed an “incentive”, according to the Associated Press.
“And the incentive is going to be they’re not going to want to pay at 25, 50 or even 100% tax,” Trump said.
Apple said on Monday it would also work with Foxconn, formally known as Hon Hai Precision Industry, to build a 250,000 sq ft facility in Houston, where it will assemble servers that go into data centers to power Apple Intelligence, its suite of AI features that help draft emails and perform other tasks. Those servers are currently made outside of the US, Apple said. The company also said it will expand its existing data centers in North Carolina, Iowa, Oregon, Arizona and Nevada.
Apple said it planned to increase its Advanced Manufacturing Fund from $5bn to $10bn, with part of the expansion being a “multibillion-dollar commitment from Apple to produce advanced silicon” at TSMC’s Arizona factory.
Apple did not disclose details of its deal with TSMC, but it has in the past used the fund to help partners build out the infrastructure needed to deliver products or services for Apple.
The announcement comes after reports indicated TSMC is in talks with Intel to acquire its chip-making plants – a move the Trump administration has encouraged, according to the New York Times. Intel has previously struggled to compete with TSMC and as it stands most of the company’s chips remain manufactured in Taiwan.
Apple will also open a manufacturing academy in Michigan, where its engineers, along with local university staff, will offer free courses for small and mid-sized manufacturing firms in areas such as project management and manufacturing process optimization.
