Trump prices could make Apple’s iPhone more expensive

San Francisco – The iPhone is a typical product of the 21st century – Californian in its creation and design and now tangled in the world economy.

Apple manufactures most of its iPhones in China, although in recent years, the company based in Cupertino has manufactured more of its products in India, Vietnam and other nations. In all, the technology giant says that it is based on more than 50 countries and regions to put airpods, iPads and MacBook in the hands of consumers.

Now this world supply chain is besieged.

This week, President Trump said he would impose a reference rate at 10% of imports from all countries on Saturday. Its administration has also added 34% tariffs to China, 46% on Vietnam and 26% on India.

“Apple has nowhere to hide,” said Eric Harwit, professor of Asian studies at the University of Hawaii in Manoa. “No matter where they do their technology, they will suffer, they will see higher costs.”

Trump’s radical rates have shaken investors and some of the world’s most precious technological companies that have fueled the global economy and the growth of Silicon Valley. They have also raised questions as to whether these global companies will repercuss the higher costs to consumers or will reduce their pay.

Apple was particularly affected. Its shares plunged more than 9% on Thursday and dropped by 7% on Friday to end at $ 188.38.

The equity prices of other technological titans, including the mother company of Google Alphabet, Meta, the manufacturer of chips Nvidia and Amazon, also experienced big declins, which made the Nasdaq Composite, the NASDAQ composite to technology, dropped by 5.8%, which is more than 20% in December.

The discomfort reflects concerns among investors that prices could cause sustainable damage, which makes American technology more difficult to compete worldwide and to dominate the race to deploy artificial intelligence technology, analysts said.

Tasks should also increase the costs of consumer electronics, including the iPhone, as products become more expensive to produce.

“Technology permeates daily life and these prices are attacks on consumer electronics,” said Todd O’Boyle, vice-president of technological policy in the Chamber of Progress, a commercial group. “These are attacks on everything we buy and which includes all foreign pieces with global supply chains.”

Samples could charge consumers for up to $ 2,500 more for an iPhone, which costs around $ 1,000, depending on the model.

Apple did not respond to a request for comments.

Meta, Amazon and Alphabet also produce consumer gadgets but earn billions of dollars a year from announcements purchased by brands from other countries, some of which Analysts say could also drop if these advertisers withdraw expenses.

Meta refused to comment, but its annual report quotes the possibility that prices or a commercial dispute can lead to a drop in its advertising revenues based on China. The company has also widened the production of its mixed reality headsets in Vietnam.

Alphabet – which makes phones, headphones, smart speakers and other consumer electronics – has also cited prices among the risks of manufacturing and supply chain which could harm its activities. He did not respond to a request for comments.

The White House said it imposed prices because it wants to return more manufacturing jobs to America.

Building too much on foreign producers could threaten economic security by “making American supply chains vulnerable to geopolitical disturbances and shocks of the offer,” said Trump in his executive decree.

“These economic policies of America have offered historical growth, wages and investments in its first mandate, and everyone, from rue Main to Wall Street, will again prosper when President Trump ensures the economic future of our country,” said the White House spokesperson Kush Desai.

He cited recent commitments of several billion dollars made by companies such as Taiwan Semiconductor Manufacturing Co. and Apple To build more manufacturing plants in the United States.

The technological industry was preparing for more prices before the president nicknamed the “Liberation Day”.

The Trump administration has already imposed prices on certain automotive and aluminum and steel parts, materials that technological companies use to create data centers that store and manage IT equipment and equipment.

The administration spared these materials, as well as copper, from its last rates. Semiconductors who electric electric and AI systems were also excluded from what the White House nicknamed the “reciprocal prices”.

Exactly how technological companies will react to the costs of prices are still not clear. Although Trump wants companies to return manufacturing in the United States, they could also move production to places with lower tariff rates. Companies would take years to build new factories.

It is also possible that these prices will not remain.

During Trump’s first term, Apple has obtained exemptions from prices imposed on imports from China for some of its products, including its smartwatch. Trump’s prices in his second term go far beyond China, affecting more countries.

Nick Vyas, founding director of Randall R. Kendrick Global Supply Chain Institute at the Marshall School of Business of the USC, said that the Trump administration reported to companies that simply move production to places outside China was not enough.

“” Each dollar that I open my market for you, I need you to open the market for me (to) the same degree, “he said, describing Trump’s thought.

Some technological companies have made efforts to bring more manufacturing to the United States

Among them is the flea manufacturer based in Santa Clara, California, Nvidia, one of the most precious companies in the world.

Although it seems that Nvidia would be spared by the weight of prices due to the exemption from semiconductors, some industry observers have said that more prices could still arrive.

Trump told journalists on Thursday that “the tokens are starting very soon” when asked if prices for the fleas were out of the table.

“We manufacture in many different places. We could move things,” said Nvidia Managing Director, Jensen Huang, during a question and answer session with analysts last month. “The prices will have a little impact for us in the short term. In the long term, we will have a manufacturing on earth. “

Apple in February said that it would invest $ 500 billion in the United States that would go to various efforts, including the opening of a manufacturing plant in Houston.

The company said in its annual report that “almost all” of its manufacture is carried out by partners mainly located in continental China, India, Japan, South Korea, Taiwan and Vietnam.

Changing where iPhones and other Apple products are made is not easy.

China has engineers who can meet high-quality specifications on Apple and the United States does not have a large number of engineers with these same skills, said Harwit.

“It is really this level of manufacturing expertise that Apple has developed for many years that makes Apple very difficult to abandon China and for the United States to find the qualified workers that the United States really needed to meet their needs,” he added.

Daniel Ives, director general of Wedbush Securities, said that it would take Apple for three years and 30 billion dollars to move only 10% of its Asia supply chain in the United States, the price of the iPhone would reach $ 3,500, he said.

“The chances that Apple and the overall technological supply chain move to the United States is a fantastic and fictitious tale, unless you like $ 3,500 Iphones, $ 2,500 TV and $ 300 AirPods,” said Ives.