Apple is back in Trump’s crosshairs over where iPhones are made
Apple’s managing director Tim Cook does not seem to take a break.
Last month, Apple seemed to guarantee a major victory when the Trump administration agreed to delete prices on certain electronics imported from China following fear that the prices of smartphones and computers can increase.
But Trump launched another curve to Apple this week when he expressed his frustration about the technology giant producing the iPhone in other parts of Asia.
“I have long informed Tim Cook of Apple that I expect that their iPhone which will be sold in the United States of America will be manufactured and built in the United States, not in India, or any other. If not, a price of at least 25% must be paid by Apple in the United States,” Trump said in an article on the social social network on the social network.
Apple did not respond to a request for comments on Trump’s remarks.
Public spat stresses that fine companies are trying to walk as they try to sail on Trump’s prices. Technological companies in particular must work with the new administration, while trying to find ways to compensate for the costs of potential tariffs.
Trump has prompted companies to build and manufacture products in the United States in the context of an effort to strengthen national and economic security.
But the displacement of production in the United States would take years and lead to price increases for consumers who are already looking at their expenses, said economists and analysts.
“We believe that the concept of apple producing iphones in the United States is a fairy tale that is not possible,” said Dan Ives, Wedbush Securities analyst in a note on Trump’s remarks on Friday.
However, Trump told journalists later on Friday that he thought that Apple could build an iPhone in the United States.
The prices should start in June and also have an impact on Samsung and other smartphone manufacturers “otherwise it would not be fair,” he added.
“I had an understanding with Tim that he would not do that. He said he was going to India to build plants. I said:” It’s ok to go to India, but you are not going to sell here without prices. “And that’s how it is,” Trump told journalists in the oval office.
Apple manufactures most of its iPhones in China, but in recent years have expanded production in India, Vietnam and other countries.
During the June quarter, Apple plans to obtain the majority of the iPhones sold in the United States from India, Cook said at the quarterly Apple call in May.
And Foxconn, a manufacturer of Taiwanese electronics contracts which assembles Apple products, plans to build a $ 1.5 billion factory in India, the Financial Times reported, citing two representatives of the anonymous government. A representative of Foxconn could not be joined to comment.
Ives said it would take at least five years to Apple to move production in the United States and iPhones prices could reach $ 3,500 if the smartphone was made in America. Depending on the model, the current cost of an iPhone can start from $ 599 but exceed $ 1,000.
Prices would also make it more expensive to repair an iPhone, as the smartphone includes parts from suppliers from other countries such as China, Taiwan, South Korea and Japan, according to ifixitAn electronic commercial website focused on repairs. For example, the display of the iPhone 16 Pro comes from South Korea; The battery comes from China.
In total, the iPhone 16 Pro is made up of around 2,700 parts from 187 suppliers in 28 countries, according to an April report from Techinsights.
Apple is not the only one to navigate the potential impact of prices. Other American companies, including Walmart, have said they would increase prices because they are faced with political pressure to eat tariff costs.
Apple is in a delicate place because if the company based in Cupertino, California, increases the prices of iPhones, consumers could simply delay the purchase of new electronics, which would also reduce the benefits of the company at a time when it faces strong competition from its competitors on the emerging market for AI.
In addition to that, Trump also criticized companies such as toy manufacturer El Segundo Mattel, who plans to increase prices, and Amazon, who planned to show the cost of prices alongside some of his products, but did not approve the idea.
Cook previously said that although there is a popular conception that companies go to China for low labor costs, the reason why Apple depends on China for the skills of its workforce.
“In the United States, you may have a tool engineers’ meeting and I am not sure I can fill the room. In China, you could fill several football fields. It is this professional expertise that is very deep,” Cook said during the Global Forum fortune in 2017.
For a while, it seemed that Apple was in Trump’s good graces. The company praised Trump when the smartphone manufacturer announced in February that it planned to invest $ 500 billion in the United States, hire 20,000 people and open a new manufacturing plant in Texas over the next four years.
Trump’s Trump’s prices have noted that companies like Apple are also faced with economic uncertainty.
Last week, the United States concluded an agreement with Chinese officials to retreat most of the prices for 90 days. The United States has agreed to lower the 145% tax imposed on Chinese goods to 30%.
Apple monitored the potential impact of prices. In May, Apple estimated that the prices could add $ 900 million to the company’s costs, but that new prices were not added.
Friday, Apple’s stock dropped by around 2% to $ 195.98 per share after Trump’s announcement.
