After 23 Years, China No Longer No. 1 For U.S. Cell Phone Imports

China is no longer the No. 1 source for U.S. cell phone imports. It had been No. 1 dating back to at least January of 2002, 279 months ago, according to my analysis of the U.S. Census Bureau trade data.

This is another marker in the ongoing 6-year-old U.S. trade war with China.

President Trump started the trade war midway through his first term. President Joe Biden tightened it slightly. And now, in his second term, Trump is only recently backing off from a threatened 145% tariff being placed on Chinese imports – essentially an embargo – to a still-exorbitant 30%.

A few other markers:

• China used to rank as the United States’ top trade partner. It now ranks third, behind Mexico and Canada.
• China used to dominate U.S. imports. Now, the United States imports more from Mexico than China.
• The U.S. trade deficit with China was five times that of any other country when the trade war began. Today, it is only half-again as large as the U.S. deficit with Mexico, which has risen substantially, while the deficit with China has fallen.
• China’s percentage of U.S. trade has slipped to a 22-year low, as I wrote previously.
• U.S. exports to China have taken a beating as well, as President Xi Jinping retaliatory tariffs went into effect.

And yet, U.S. trade – and the U.S. trade deficit – have continued to climb, mostly because a number of imports that once came from China now come from other Asian nations, despite the clamor of near-shoring.

And so it is with the cell phone, the latest marker in the trade war.

In the month of April, for the first time since at least January of 2002 (that’s as far back as the data upon which I rely goes), India ranked first, China second.

It’s such a long run for China in the No. 1 position that in 2007 the government reclassified the cell phone, changing it from a category that treated it like something of a walkie-talkie, if you are old enough to remember those, and began treating it as a type of phone.

I wonder: Would it not be more appropriate to classify this amazing handheld device that runs our lives as something more akin to a computer?

Regardless, it’s a truly amazing turn of events for the cell phone, a device so synonymous with Chinese manufacturing that it is the subject of a new book, Apple in China: The Capture of the World’s Great Company. As the title suggests, the book is not kind to Apple, CEO Tim Cook or China.

The turn of events in the data that saw China slip to No. 2 was swift.

In September of last year, China still accounted for 91.30% of all U.S. cell phone imports – what Census now calls the “Smartphone.” By December, that percentage had fallen below 80%. By January of this year, it had fallen below 70%. In February and March, the percentage barely topped 50%.

Then came April. The U.S. percentage of cell phone imports from China dropped to 26.95%. India, whose market share stood at 4.92% the same month China topped 91%, in November, jumped to 57.75% in April. Apple, of course, produces iPhones in India, with about 90% of those exported from India into the United States.

Vietnam, which stood at 3.14% of the total last November, jumped to 14.09%. The three nations have accounted for more than 95% of all U.S. cell phone imports since February of 2017, a total of 98 months. Samsung, Apple and Google ship cell phones from Vietnam to the United States.

For most of that time, it was all about China. China accounted for better than 80% of the total for 49 of those months – and never dropped below 50% until April.

If you broaden the category to include the equipment used to allow the cellular networks to function properly – as the image at the top of this post shows – China slipped from first to third as an importer into the United States. Vietnam, given the strength in the area of routers and other equipment, ranked first in April, India second and China third.

The fall for China was, similar to the phone itself, somewhat spectacular, from 53.28% in October of last year to 14.14% in April. Vietnam nearly doubled over that same six-month time period, from 14.88% to 23.44%. India went from 5.15% to 19.51%, almost quadrupling.

China had once dominated the cellular equipment market as well, gaining the top spot in August of 2007 and keeping it until January of 2022, when Vietnam took over. China now also ranks behind Thailand, Mexico, Taiwan and Malaysia in this category.

While market forces were primarily at work in the decline of China as the preeminent importer of cellular network equipment into the United States, it was a Trump-originated and bipartisan trade war that cost China its top ranking for cell phone imports into the United States.