US President Donald Trump (r) and Apple CEO Tim Cook speak to the press during a tour of the Flextronics computer manufacturing facility where Apple’s Mac Pros are assembled in Austin, Texas, on November 20, 2019.
Mandel Ngan | AFP | Getty Images
President Donald Trump said in a social media post Friday morning that Apple could have to pay a tariff of 25% or more for iPhones made outside the US.
“I even have way back informed Tim Cook of Apple that I expect their iPhone’s that shall be sold in the US of America shall be manufactured and inbuilt the US, not India, or anyplace else. If that isn’t the case, a Tariff of no less than 25% should be paid by Apple to the U.S.,” Trump said on Truth Social.
Shares of Apple fell about 3% in premarket trading.
Production of Apple’s flagship phone happens primarily in China, but the corporate has been shifting manufacturing to India partly because that country has a friendlier trade relationship with the U.S.
Some Wall Street analysts have estimated that moving iPhone production to the U.S. would raise the value of the Apple smartphone by no less than 25%. Wedbush’s Dan Ives put the estimated cost of a U.S. iPhone at $3,500. The iPhone 16 Pro currently retails for about $1,000.
That is the most recent jab at Apple from Trump, who over the past couple of weeks has ramped up pressure on the corporate and Cook to extend domestic manufacturing. Trump and Cook met on the White House on Tuesday, in accordance with Politico.
Cook gave $1 million to Trump’s inauguration fund and attended the inauguration in January. Apple has announced a $500 billion spend on U.S. development, including AI server production in Houston.
Apple declined to comment for this story.
The corporate said during its May 1 earnings report that it expects about $900 million in additional costs for tariffs in the present quarter. Cook said on the corporate’s earnings call that the tariff outlook was “very difficult to predict” past June.
Foxconn, one among Apple’s principal iPhone assembly partners, is spending $1.5 billion on expanding its India facilities, the Financial Times reported Thursday.
Trump has made public criticisms of other major U.S. corporations, including Walmart, during his trade war push, however the levies on a selected consumer product is a brand new step. The precise legal mechanism for the tariff is unclear.
Trump followed up his post about Apple with one other calling for a 50% tariff on products from the European Union. Taken together, the posts point to trade tensions increasing again after the U.S. had temporarily lowered lots of its levies, including in an agreement with China.
Apple also needed to navigate tariff threats during Trump’s first term, when a 15% tariff on Chinese imports was being considered in 2019. At the moment, Cook had a robust relationship with Trump and the ultimate trade deal excluded core Apple products from the duties.
As Apple is caught within the U.S. president’s crosshairs, the corporate can be seeing weak demand in China. On Friday the corporate hiked trade-in incentives for iPhones in China.
