When President Trump prompted the customs tariff for the first time in China in 2018, Apple started transferring more iPad and AirPods to Vietnam and iPhone to India.
But with Mr. Trump’s return to the White House, this strategy may have led to the opposite results of the world’s most valuable company.
On Wednesday, Mr. Trump said that the United States will make 46 percent definitions of Vietnam and 26 percent in India. The White House said the definitions are effective immediately, but some trade experts consider them as first and designers to be a starting point for negotiations to reduce customs tariffs abroad.
Suggested definitions threaten to comply with pressure on Apple. The company is already deals with 20 percent of the customs tariffs on products imported from China, as Apple manufactures about 90 percent of the iPhone devices it sells all over the world. Mr. Trump said the rate will reach 34 percent under the new tariff plan.
The new fees are part of Mr. Trump’s efforts to reshape global trade with definitions on each country that imposes fees on American exports. American trade officials estimate that India A tariff rate of 13.5 percent On American goods, with a tariff of 39 percent on agricultural products. Vietnam has a tariff rate of 8.1 percent on American goods, with a 17.1 percent tariff for agricultural products.
But during a White House press conference, Mr. Trump said that the mix of customs tariffs and currency manipulation and commercial barriers had a more important impact.
It can put the costs of “mutual definitions”, as Mr. Trump calls it to put Apple’s work in a jam. The iPhone, iPads and Apple Watchs that the company sells provides three -quarters of its annual revenue for approximately $ 400 billion. With Mr. Trump saying that he will not allow the products to be exempt from tariffs, Apple will have to either pay these fees, which will reduce their profits, or to pass those added costs indirectly to customers by raising prices.
The definitions of iPhone and other devices imported from China will increase from Apple’s annual costs by $ 8.5 billion, without any comfort from the Trump administration, according to Morgan Stanley. This would reduce the company’s profit next year by $ 0.52 per share, or about 7.85 billion dollars. This will be about 7 percent on profits next year.
Apple shares decreased by 4.7 percent in after -sales trading after Mr. Trump’s comments.
“Apple will take these new tariff numbers and put them in models they built and know within hours of how much the problem is facing,” said Anna-Katrina Shootsky, the Bay Area Foundation that uses artificial intelligence to improve manufacturing performance. I worked previously in Apple.
After Mr. Trump took office, Tim Cook, CEO of Apple, went to the White House and promised that Apple would invest hundreds of billions of dollars in the United States. In February, Apple followed this promise to pledge to invest 500 billion dollars In the country, with a lot of money already is part of the spending plans.
During the previous Trump administration, Mr. Cook’s work to build a relationship with Mr. Trump helped to avoid customs tariffs on most of its products. American commercial officials in the previous Trump administration did not put a tariff on iPhone, and they removed the definitions from Apple Watch.
In 2019, Mr. Trump toured an apple factory In Texas, which made desktop computers. Mr. Cook stood beside Mr. Trump as the president got the credit for the factory, who has been making computers since 2013.
In the years since, Apple has not transferred the production of one major product to the United States. Instead, I began an attempt to diversify outside China.
In 2017, as Mr. Trump started his position, Apple began preparing assembly lines for iPhone devices in India. It took five years to train workers and build infrastructure Make the latest iPhone devices In the country. It is about to increase production there, hoping that the country’s factories will make about 25 percent of 200 million iPhone that they sell annually.
The company also started converting AirPods, iPads and Macbooks to Vietnam. The country became a destination for Apple and others after Covid-19 closed factories in China in 2020, and Vietnam factories accounted for more than 10 percent of the best 200 suppliers who was the company in 2023.
Vietnam was an attractive position because of her proximity to China. India was attractive because Apple wanted to increase sales of iPhone devices in the country, which is the second largest smartphone market in the world.
But Apple struggled in the past with the production of the United States. The Texas Factory, which made Macs, faced problems as some workers went out of the job after their offering, but before their alternatives arrived, forcing the company to stop the assembly line. We also fought to find suppliers who can make the ingredients you need Like a designated screw.
Mr. Cook said that the United States does not have enough manufacturing workers to compete with China. in Conference in late 2017He said China was one of the few places where Apple could find people who are able to manage modern machines that make its products.
“In the United States, you may have a meeting for the tool engineers, and I am not sure that we can fill the room,” said Mr. Cook. “In China, you can fill multiple soccer fields.”
