Why is Apple Increasing Its Investment in China?

Apple is set to increase its investment in China, a move announced by CEO Tim Cook during a visit to the country in October.

This decision comes at a complex time, with continued trade friction between the US and China, and pressure from the White House to prioritise domestic manufacturing and employment for American workers.

The technology company has previously made commitments to Washington, with Reuters reporting a pledge to invest US$100bn in US-based manufacturing.

In a symbolic gesture in August 2025, Tim presented President Donald Trump with a custom-made plaque to commemorate Apple’s ‘American Manufacturing Program’. US companies operating in the region face a difficult balancing act.

An anonymous government affairs consultant from Shanghai told Reuters that businesses are “wary of angering a White House that could hurt them at home in the world’s biggest consumer market for appearing too pro-China”.

The consultant added that these same companies are simultaneously wanting to appear as though they are “in China for China”.

While Apple has not disclosed a specific figure for its new investment, Li Lecheng, the Industry Minister in China, communicated that the country hopes Apple will continue its expansion and grow alongside Chinese suppliers, assuring that China would maintain a supportive business environment for foreign enterprises.

Navigating geopolitical and trade disruption

Tim Cook has so far successfully navigated Apple through the majority of the US-China trade disputes, a feat other technology firms have failed to replicate. Companies like Nvidia and Qualcomm have found themselves embroiled in the conflict.

Nvidia has become a notable subject in the trade war, with Beijing accusing the American chipmaker of infringing its anti-monopoly legislation. This situation illustrates the potential regulatory risks for foreign companies operating within the country.

According to a Reuters report, China's State Administration for Market Regulation (SAMR) announced on 15 September that a preliminary investigation suggested Nvidia had potentially breached commitments made during its 2020 acquisition of Mellanox Technologies.

That deal was approved by China on the condition that Nvidia would continue to supply advanced GPU chips to the Chinese market.

This development occurred during wider trade negotiations in Madrid, where semiconductors were a key point of discussion. US Treasury Secretary Scott Bessent described the timing as “poor”.

Regulatory Scrutiny on US Tech

The SAMR has not specified the exact nature of Nvidia's violation, but penalties could range from 1% to 10% of Nvidia's annual sales in China.

These sales represented 13% of its global revenue in the previous year.

In a statement, Nvidia said it was "complying with the law and would continue to cooperate with all relevant government agencies as they evaluate the impact of export controls on competition in the commercial markets."

This action is viewed by some analysts as a strategic move by China.

Zhengyuan Bo of Plenum said: "It's a warning that if the US export control paradigm operates in the same way as in the past several years, there will be consequences and China is willing to inflict damage on US companies."

This is not an isolated incident. Reuters also reported that on 10 October, China’s market regulator initiated a separate investigation into the US semiconductor manufacturer Qualcomm, which is suspected of violating the country’s antitrust laws.

These actions highlight a challenging operational environment for American technology firms.

Apple's market performance in China

Despite the political and trade headwinds, Apple’s performance in the Chinese market remains robust.

Data research firm IDC announced on 15 October that Apple’s shipments in China grew 0.6% compared to the previous year.

This made it the only one of the country’s three largest vendors to see an increase in shipments during this period, a success attributed partly to the launch of the iPhone 17. The commercial incentive for Apple to maintain a strong presence in the country is clear.

During his visit, Tim’s itinerary included a visit to an Apple store in Shanghai and meetings with Chinese game developers and the designer of Labubu dolls, showing a continued focus on building local relationships.

This strategy of engagement could be essential for sustaining its market position.

Reinforcing this perspective on business relations, China’s Ambassador to the US Xie Feng said during an event in Washington: “The business community has always been a stabiliser of China-US relations and a promoter of pragmatic cooperation.” Reuters reported.