Apple Commits $1 Billion To Fund US Expansion Of Advanced Manufacturing

What is a company to do when it is sitting on a $256 billion pile of cash? If you’re Apple, you peel away a tiny sliver of that money to reinvest in the United States. That’s coming straight from the horse’s mouth, or in this case, Apple CEO Tim Cook.

In an interview this week with CNBC’s Jim Cramer, Cook explained that Apple would set aside the $1 billion for an advanced manufacturing fund. “It's $1 billion of our US money, which we have to borrow to get. That's another whole topic.”

tim cook

Cook’s off-hand comment refers to the fact that most of Apple’s cash pile is held overseas, and the company has no plans to repatriate that money unless it can secure more favorable terms with regards to the U.S. tax code.

"By doing that we can be the ripple in the pond, because if we can create many manufacturing jobs, those manufacturing jobs create more jobs around them," Cook added.

Unfortunately, Cook didn’t provide many details on how exactly this fund will be used, but we can only assume that we may see some high-margin products being produced on U.S. soil (like the current Mac Pro, which is at least partially assembled in the U.S). It’s doubtful that we’ll see products like the iPhone assembled here in America unless Apple is willing to take a big financial hit due to the higher wage structure.

apple park
"Apple Park", Apple's new HQ currently under construction

This move by Apple plays right into President Donald Trump’s call for American companies to reduce foreign investments and spend that money right here at home. President Trump was a very vocal critic of Apple during the 2016 campaign season, attacking the company for its reliance on Chinese manufacturing.

"We have such amazing people in this country -- smart, sharp, energetic, they're amazing,” said then-candidate Trump during a speech in early 2016. “I was saying, make America great again, and I actually think we can say now, and I really believe this, we're gonna get things coming. We're gonna get Apple to start building their damn computers and things in this country, instead of in other countries.”

With President Trump now in the driver’s seat, Cook may be hoping that a gesture towards increasing American investments could payoff with tax reform that could allow the company to bring some of its overseas cash back home.

Top Image Source: iphonedigital


Via:  CNBC
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