Most Apple products sold in the US could see price raises, after Trump imposed 10% import tariffs on all imports from China. While Apple has been working on diversifying its supply chain, the majority of its products are still assembled in China.
Trump did a similar thing in his first term, applying tariffs to thousands of products. That time, Apple was successful in lobbying for exceptions, but the new policy appears to be a blanket 10% across all products arriving from China …
Previous chip threat hasn’t been carried out
Trump’s initial threat was to impose import duties of up to 100% on Chinese-made silicon chips imported into the US. This would have been unlikely to impact Apple as it applied solely to chips, not to devices containing them.
However, it was quickly pointed out that the this would have hurt US companies manufacturing electronics products in America after importing components from China. Trump subsequently went quiet on this front.
Blanket 10% tariff now imposed
Trump’s next move was to threaten a blanket 25% tariff on all products imported from Canada and Mexico, and a blanket 10% tariff on all goods imported from China.
Canada and Mexico responded with a mix of carrot and stick. On the carrot side, both countries made promises to step up border protections against illegal migration and drug trafficking. While Canada mostly re-announced measures it had already introduced, it allowed Trump to claim a victory.
On the stick side, all three countries threatened to respond in kind, with import duties on US products.
Trump announced a 30-day suspension on the measures for Canada and Mexico, but BBC News reports that the Chinese tariffs have now been officially implemented.
President Donald Trump has agreed to hold off imposing 25% tariffs on Canada and Mexico for 30 days, pulling the North American neighbours back from the brink of a potentially damaging trade war […]
But a US tariff of 10% on Chinese imports has come into effect, after a deadline of 00:01 EST (05:00 GMT) on Tuesday passed. Shortly after, Beijing announced it was imposing retaliatory tariffs on a raft of American products.
China has also announced potential antitrust investigations into Apple and Google, the latter announcement made within seconds of the tariffs taking effect.
Apple products now more expensive to import
With the new policy, Apple will have to pay an extra 10% on the cost of all products imported from China.
Most companies are expected to pass on the additional costs to US consumers in the form of higher prices, but it’s not yet known how Apple will respond. Its other option would be to absorb the increased costs, reducing its profit margins.
9to5Mac’s Take
Trump’s actions reflect the fact that his team has still not managed to explain to him how tariffs work. He still talks about making foreign companies pay them when the reality, of course, is that they are paid by American companies and consumers importing goods from China.
As for Apple absorbing the costs or raising prices, historically the company has done a mix of the two. Given the volatility of the situation, with Trump changing his mind on almost a daily basis, it seems likely Apple will do nothing for now. Once it becomes clearer whether the tariffs will remain in place, the company will then have to make a decision.
Photo: Apple
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