Trump’s government recently declared trade tariffs on China, in response to the deteriorating relationship between the two countries. Apple expressed its dismay, stating that the prices of its product would increase by up to 25%, for China is their main assembler.
Trump said that the administration staff had planned imposition of tariffs on $267 billion worth of Chinese goods.
Trump recently gave the ‘answer’ to their situation in form of a tweet-
Apple prices may increase because of the massive Tariffs we may be imposing on China – but there is an easy solution where there would be ZERO tax, and indeed a tax incentive. Make your products in the United States instead of China. Start building new plants now.”
Apple declined to comment on Trump’s tweet.
What this implies is that Trump won’t exempt Apple from the tariff plans. If Apple wants to escape the burden of the tariffs, they’d have to shift the production to US. This won’t be feasible considering the cheaper labor China provides.
The catch is, Apple CEO Tim Cook met with Trump last month regarding the trade measures. Cook, in a statement, stated that the tariffs won’t impact the price of the iPhone, which seems otherwise now.
Apple voiced its concern in form of a letter, which stated how the tariffs are detrimental for the economy.
More broadly, tariffs will lead to higher U.S. consumer prices, lower overall U.S. economic growth, and other unintended economic consequences. As a result, tariffs will ultimately reduce the economic benefit we generate for the United States,”
Implementation of such tariffs would make the already expensive Apple devices more costly. Apple will launch a series of new products on September 12, which will include 3 new version of the iPhone. Apple is optimistic about this launch event and believes that it will give a strong competition to its competitors.