Apple has a backup plan if the US-China trade war gets out of hand. The Cupertino California-based company’s primary manufacturing partner has enough capacity to make all iPhones bound for the US outside China if necessary, according to a senior executive at Hon Hai Precision Industry. The Taiwanese contract manufacturer, known also as Foxconn Technology Group, now makes most of the smartphones in the Chinese mainland. China is a crucial cog in Apple’s business, the origin of most of its iPhones and iPads as well as its largest international market. But US President Donald Trump has threatened Beijing with new tariffs on about US$300 billion worth of Chinese goods, an act that would escalate tensions dramatically while levying a punitive tax on Apple’s most profitable product. Inside Apple’s high-stakes diplomacy in the US-China trade war Hon Hai, the world’s largest electronics contract manufacturer, is the American technology giant’s most important manufacturing partner. It will fully support Apple if it needs to adjust its production as the US-Chinese trade row gets grimmer and more unpredictable, board nominee and semiconductor division chief Young Liu told an investor briefing in Taipei on Tuesday. “Twenty-five per cent of our production capacity is outside China and we can help Apple respond to its needs in the US market,” said Liu, adding that investments are now being made in India for Apple. “We have enough capacity to meet Apple’s demand.” Apple has not given Hon Hai instructions to move production out of China, but it is capable of moving lines elsewhere according to customers’ needs, Liu said. Hon Hai will respond swiftly and rely on localised manufacturing in response to the trade war, just as it foresaw the need to build a base in the US state of Wisconsin two years ago, he said. It is unclear if India will ever become a major production base for Apple’s marquee device. Foxconn said to begin assembling top-end Apple iPhones in India in 2019 Hon Hai is now running quality tests for the iPhone XR series there and plans to begin mass production at a facility in the suburbs of Chennai. Older models are already assembled at a Wistron plant in Bangalore. The Taiwanese manufacturer last year agreed to build a 13,000-worker facility in Wisconsin in exchange for more than US$4.5 billion in government incentives. But that project has since come under criticism for low-paying jobs, sudden dismissals and ever-changing goals. On Tuesday, Hon Hai executives reaffirmed that employment goal, saying construction remained on schedule and that it will hire as many as 2,000 Americans by the end of 2020. It will also start making networking and server products for the US market by the end of next year, on top of liquid crystal displays starting next year, Liu said.