Apple has decisions to make.
President Donald Trump announced on Wednesday radical prices that will disrupt the supply chain for many companies. For Apple, the rate of rate of 54% on China and a price of 46% on Vietnam presents a challenge: analysts estimate the vast majority of its product range is made in both countries.
If things continue as they are now, Apple is on the right track to deal with $ 40 billion in price costs, wrote Rosenblatt Barton Crockett analyst in a note. The technology giant will have to decide if he will try to compensate for the costs by increasing the prices of the iPhone.
The Crockett and Wedbush Securities Dan Ives analyst predicts a price increase of around 40% on technological devices to facilitate the impact of prices. Iphones could become more expensive at the same time as Apple put pressure for more demand. Apple’s shares have dropped by more than 8% to the closing of the market after Trump’s announcement – its biggest decrease in five years.
Apple did not immediately respond to a request for comments from Business Insider.
The iPhone 16 starts at $ 799. An increase in prices of 43%, as Rosenblatt estimated, would bring it to $ 1,142 before taxes – $ 50 cheaper than the most expensive iPhone in the current Apple range. For the high -end iPhone 16 Pro Max, which costs up to $ 1,599, a bump of 43% would put it at just under $ 2,300, according to BI calculations.
Movement of production in the United States will probably not save consumers, said Ives. He estimates that an iPhone made in the United States would cost $ 3,500. However, Crockett wrote that change is not possible for an immediate future.
China quickly applauded Trump’s prices with its own on Friday. From April 10, American imports in China will be invoiced a rate of 34%. It presents another challenge for Apple on the crucial market in Grand China where it is faced with increasing competition from local smartphones manufacturers.