Patrick McGee’s new book, Apple in China: The Capture of the World’s Greatest Company, is out this week, just as the U.S. and China agreed to lower tariff levels for 90 days, with levies on Chinese imports dropping to 30% from up to 145%. 

Apple, the world’s second-most valuable company, is caught between the U.S., its home country, and China, its primary manufacturing base. Over the past few years, Apple has set up more production lines in Vietnam and India, and Chief Executive Tim Cook recently said most iPhones sold in the U.S. would be made in India. The company has also pledged to buy chips from TSMC’s Arizona plant and to make servers in Texas starting next year. 

Yet McGee, who reported on Apple for the Financial Times, argues that the company is still far from withdrawing from China. The company has invested billions of dollars in talent and equipment in China, and the country’s authoritarian government now has more influence over Apple’s fate than any other country, he writes. As China and the U.S. held their closely watched trade talks, McGee spoke to Rest of World about where Apple stands. 

The interview has been edited for length and clarity.

What is the main thrust of your book? 

My argument is essentially that Apple is playing the role of Prometheus handing the Chinese the gift of fire. Apple’s influence on China exceeds that of the Marshall Plan’s impact on Europe after World War II. 

Apple acknowledges that it’s trained 28 million workers in China since 2008. It’s greater than the labor force of California. And the figure is a decade old, but they were investing $55 billion a year in China.

The Achilles heel of the company is that everything is made in China … [and] we were not putting enough attention on it.

Apple has been expanding its manufacturing presence in countries like India and Vietnam. Do you think Apple is on its way to reduce its reliance on China? 

I think Apple wants the perception that they are moving a lot to India, that they are responding to what Donald Trump is asking for. And they want the reality of continuing to build as much as they can out of China because its capabilities there are second to none.

If next year you buy an iPhone and it says “Made in India” on the box, that phone will not be any less dependent on the China-centric supply chain than any other iPhone you have ever purchased.

If for some reason something hits the fan in China, no iPhones will be made in India because all of the sub-assembly, and the years of work leading up to it, is still all taking place in China.

Why is Apple so slow on diversifying out of China? Is the company worried about anything happening to its supply chains there? 

One is that China can make it really difficult for them. Are they going to more publicly move things to India? And say “yep, we are rounding down our investments in China?” 

I quote someone saying that they need to walk out of China, but they can’t run. If they run, they risk the ire of Beijing as well as the Chinese consumers. But if they go too slowly, then they remain stuck in China. So they have to find this perfect pace to exit because they can’t become the poster child of de-risking from China. 

I have got sourcing that Apple has told China, “OK, more stuff is going to India, but the supply chain is becoming more and more Chinese.” The rise of the “red supply chain,” which includes companies like BYD, [electronics firm] Luxshare, [acoustic parts maker] Goertek, and [semiconductor company] Wingtech, is of geopolitical importance.

Can Apple replicate its powerful supplier network in China elsewhere? 

I wouldn’t say never, but I’m not optimistic. I think China was a once-in-a-century partner that operated at a level of investment, of speed, of political quickness that it’s going to be really difficult for any other country to replicate.

Things are moving to India, just way more slowly than anybody seems to understand. Apple started with zero phones made in China in 2007. By the end of the year, they had made 3 or 4 million. And by 2014, they were building about 200 million phones. 

A decade later [2017], the first phones were made in India. And by 2024, about 25 million phones were made in India. At best, the diversification to India has happened at one-tenth the speed that happened in China a decade earlier. 

Why Vietnam is so proficient at manufacturing is that they are close enough to China to be able to get all the materials and components. But if something blew up in China, again, you wouldn’t be like, Oh well, thank God for doing this in Vietnam. Because in that scenario, Vietnam would be as exposed to China as anybody else is.

You write that the supply chains Apple cultivated have also benefited China’s homegrown tech giants. Apple is now losing market share to Chinese brands like Huawei and Xiaomi; are the Chinese tech industry and consumers ready to live without Apple? 

The reason why Beijing at the moment would not take any action against Apple is because they learn so much from them. For instance, the Vision Pro headset is all being assembled by Luxshare. So you can imagine it’s a bunch of Ph.D.s from Apple teaching them how to do it.

I don’t know that iPhone share is going to fall apart anytime soon, just because there are so many other reasons why, if you’re in that ecosystem, you stick with it. But consumer loyalty is less explicit in China. So many of the applications that they use are not from the app store, but the WeChat universe. And Chinese customers have reasons for supporting a national champion. 

As China and the U.S. negotiate tariffs and trade now, can Beijing use Apple as a bargaining chip? 

The way you phrased the question is already really revealing, right? You didn’t ask, can Washington use Apple as a bargaining chip?

That’s a crazy thing to say, that it’s America’s most iconic company and it’s a bargaining chip of Beijing’s. Yeah, I mean, you’re totally right. Beijing clearly has more of a hold on Apple’s day-to-day operations than Washington does.

Drones from Chinese giant DJI are deeply embedded in American life. With a potential ban looming, the company has until the end of the year to convince U.S. lawmakers it does not pose a national security threat, amid trade tensions between the two countries.

The most immediate threat of a ban comes from a clause in the 2025 National Defense Authorization Act, a U.S. law that sets the annual military budget. Passed in late 2024, it requires DJI to clear a national security review or face an automatic ban by the end of 2025. No review has yet been scheduled, and the legislation does not specify which agency should carry it out. A de facto ban would also cover Autel, another popular Chinese drone brand.

“If no agency completes that evaluation within one year of enactment, DJI and other covered entities will be automatically added to the FCC’s Covered List,” Rep. Michael Guest, chairman of the Border Security and Enforcement Subcommittee, told Rest of World, referring to the Federal Communications Commission’s list of unauthorized equipment. 

“Restricting DJI is a justified and necessary action to protect U.S. security interests,” Guest said, confirming that no agency has been tasked to conduct a review. 

The U.S. legislation, which mandates a risk assessment of DJI’s drones, could automatically ban the technology “through no fault of its own,” a spokesperson for DJI told Rest of World. 

“We are actively engaging with members of Congress to encourage a fair and evidence-based evaluation process,” the spokesperson said.

The U.S. government has said its push to restrict DJI is rooted in fears that the company’s drones could collect sensitive data for China’s military or intelligence agencies. But given DJI’s edge in cost and capability over its rivals, a ban would be difficult to implement.

“Among the downsides of a ban are the near-term impacts on a range of users and consumers, considering DJI’s comparative advantage relative to most competitors in price and performance,” Elsa Kania, an adjunct senior fellow at the Center for a New American Security, told Rest of World.  

DJI’s fate could serve as a bellwether for how the U.S. weighs the risks and benefits of allowing Chinese companies to operate in the country, given Beijing’s “capacity to control and influence its tech sector,” said Kania, whose research focuses on Chinese technologies. 

Chinese government influence and national security concerns were also behind a move to ban TikTok — which sent users flocking to another Chinese social media app, RedNote. While the TikTok ban is now unlikely, the fate of DJI could become another flash point in U.S.-China tensions. Earlier this month, Washington and Beijing agreed to a 90-day tariff truce, with the U.S. lowering most tariffs on Chinese goods from 145% to 30%, and China reducing its 125% tariff on U.S. imports to 10%. 

The Chinese foreign ministry said in January that Beijing would “take all necessary measures” against a potential ban on Chinese drones. A senior DJI executive sent a letter in March to U.S. officials, urging them to initiate the required review, saying “we welcome this scrutiny.”

The Bureau of Industry and Security, which is responsible for implementing U.S. export controls, did not respond to requests for comment on the status of a review for DJI.

Without a review, DJI would be barred from selling new products in the U.S., and restricted from updating existing ones because it would not be able to obtain FCC certifications for wireless transmitters that are an essential part of the drones, Rupprecht Law, a Florida-based firm that specializes in drone law, wrote in a note on the legislation.

For DJI, the stakes are immense. It said in 2021 that North America was its biggest market, but has not provided updated sales data in recent years. The global drone market will be worth $57.8 billion by 2030, according to Hamburg-based consultancy Drone Industry Insights. 

First developed in a college dorm room in Hong Kong in 2006 by founder Frank Wang, DJI commands about 70% of global drone sales. Its top-performing and relatively low-cost models are widely used by the police, firefighters, emergency responders, and professionals in science and media.

But along with its popularity came concerns. In 2020, a French cybersecurity firm reverse-engineered DJI’s Android app and found it collected user data and could install updates without user consent. A 2023 peer-reviewed study found DJI’s Wi-Fi could be hijacked, letting attackers seize control of drones with off-the-shelf gear. 

DJI has said it has implemented updates including a local data mode to prevent data transmission over the internet. It has also declared no government entity sits on its board, and that it has never received overseas data requests from Chinese authorities. 

There have been other efforts to limit Chinese drones in the U.S. Last year, the House passed the Countering CCP Drones Act, which sought to ban the sale and use of DJI and Autel drones, but it stalled in the Senate. Earlier this year, the U.S. Commerce Department announced it was considering new rules to restrict Chinese drones.

DJI isn’t the only Chinese firm to come under scrutiny. Besides TikTok, the U.S. has made efforts to bar BYD’s electric vehicles with high tariffs, and imposed sanctions on Huawei’s chips on national security grounds. 

“The concept of national security is becoming more expansive, and industries that were regarded previously as promising from a commercial perspective are now increasingly viewed through a security lens,” Kania said.

To counter these efforts, DJI has spent nearly $7 million lobbying lawmakers since 2019, when Congress first restricted the Pentagon and federal agencies from buying Chinese drones because of national security concerns. That year, its lobbying budget more than doubled to $1.4 million. It has since enlisted several powerful lobbying firms like Liberty Government Affairs, which also represents Chinese fast-fashion giant Shein in the U.S.  

It has also tried to win over its users, engaging with public safety agencies, educational institutions, and other drone users on platforms like Reddit, YouTube, and Instagram. It points to third-party security audits and compliance with Western cybersecurity protocols as evidence of its transparency.

The company also co-founded the Drone Advocacy Alliance, which organizes users to oppose country of origin-based restrictions. Members include U.S. drone firms Blue Nose Aerial Imaging and Dronelink, many of which partner with DJI or use DJI drones in their services. The group facilitated more than 60,000 messages to lawmakers opposing the Countering CCP Drones Act, a separate bill that calls for the ban of Chinese drones, according to Chris Fink, a board member of the Drone Advocacy Alliance. Many supporters emphasize the role of DJI drones in public safety, such as search and rescue. 

U.S. drone makers have formed their own coalition, the Partnership for Drone Competitiveness, backed by U.S. manufacturers including Skydio and Brinc. The group argues DJI receives unfair subsidies from the Chinese government, and that relying on foreign-made drones poses national security risks. Yet companies including Skydio source components from China.

The tariffs may well tilt the balance. DJI increased prices in response to U.S. tariffs on Chinese goods, and has said U.S. customs officials blocked some of its shipments at the border. 

Its new professional drone, the Mavic 4 Pro, has not yet been launched in the U.S., leaving some customers to consider purchasing it in Canada or Mexico.  

“Customers want the best technology at the best price,” Fink said. “That still often means DJI or other Chinese-made drones.”