'Apple CEO promised to build three big plants in US'

US-POLITICS-TECHNOLOGY

Trump claims that Apple CEO Tim Cook called him and committed to construct "three big plants, attractive plants" domestically. Trump said in the interview with The Wall Street Journal.

"I spoke to [Cook], he's promised me three big plants - big, big, big", Trump said. (NASDAQ:AAPL) has committed to building three new U.S. Apple factories. It's thought to be more likely that Trump's promise that Apple is building three new factories in the United States actually means Apple's partners will be building these factories, possibly with Apple investment in the locations.

In the first scenario, Apple would get components for the iPhone, such as the memory chip, processor, and display screen, shipped to its hypothetical plants in the US from around the world and put it together in the plants.

What comes from the White House's STEM efforts remains to be seen, but we'll be sure to update as to how Cook's role transforms throughout the process. Apple claims to employ somewhere around 80,000 people in the United States, but it was a big focus during Trump's campaign, at times facing criticism for its overseas manufacturing (and at others times, promises). Again, these are not Apple plants, but they do create jobs in the United States.

Moving iPhone manufacturing to the U.S. would also likely push up costs which can not be in Apple's interests.

The tech giant has resisted the idea of bringing the cash home, because the USA tax code allows multinational firms to defer profits while they are held overseas but taxes income at up to 35 percent when repatriated. Building three new factories in the US would be a big change for the company, which has built a sophisticated supply chain overseas allowing it to score huge margins on its mobile devices.

The vast majority of Apple's products are assembled in China by Foxconn.

Apple, on its part, had been making disclosures to highlight how it had been contributing to job creation in the US. On Wednesday, Foxconn Technology announced it would open a plant in Wisconsin.

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