Apple signs $500 million deal to make iPhone magnets under Trump pressure

iPhone maker Apple has signed a $500 million deal with US company MP Materials under pressure from President Donald Trump to produce domestically. The partnership, announced on Tuesday (July 15) local time, will see Apple buy rare earth magnets directly from the company, which are used in devices such as the iPhone, iPad and MacBook. A new recycling line will also be built in California, where rare earths will be recovered from used products and used in Apple’s new gadgets. Roughly speaking, 92% of the world’s rare earth processing is controlled by China. The Trump administration has taken this initiative to avoid technology transfer and trade conflicts with China. In May, Trump warned in Truth Social that Apple would face a 25% tariff if the iPhone wasn’t made in the US. In the meantime, Apple is using 30% recycled materials in the ‘iPhone 16’. The project will accelerate its environmental plan. MP Materials’ Fort Worth factory will start operating an Apple-specific magnet line starting in 2027, which will supply “hundreds of millions of devices.” The move is expected to create dozens of new jobs and provide training for workers, analysts say. Experts say the main obstacle to moving iPhone production to the US is the lack of the necessary skilled workers. Apple CEO Tim Cook hinted in 2017 that China’s “combination of engineering, robotics and computer science” helps with production. From smartphones, electric car batteries, MRI machines to military jets—rare earths are essential components of modern technology. Although they are abundant in the Earth’s crust, extraction and processing are extremely expensive, and China maintains a monopoly in this sector.