U.S. President Donald Trump has warned that mobile phones made abroad — including Apple iPhones and Samsung phones — would be exposed to a 25% tariff on imports if firms fail to bring their production to American soil.
Trump explained that the anticipated import tariff would not target Apple alone. "It would be more. It would be also Samsung and anybody that produces that product. Otherwise, it wouldn't be fair. When they construct their plant here, there is no tariff," Trump explained in an interview in the Oval Office.
In an early Friday morning social media post, Trump announced he had already spoken to Apple CEO Tim Cook about his expectations. "I have long ago spoken to Tim Cook of Apple that I expect their iPhone's that will be sold in the United States of America will be built and produced in the United States, not India, or any other place," he wrote.
"Unless that is true, Apple must pay a Tariff of at least 25% to the US," he added.
The statement follows a meeting between Trump and Cook. A White House official stated that Trump was displeased with Apple's continued movement of iPhone production away from China to India.
I had an agreement with Tim that he was not going to be doing this," Trump said. "He told me he was going to India to construct plants. I said, 'that's alright to go to India, but you're not going to sell into here without tariffs.'
These recent remarks mark a significant shift in Trump's strategy. While earlier he asserted that other countries would bear the expense of tariffs, now he maintains that corporations such as Apple will fund the costs themselves. This action may lead to price increases for consumers, as firms usually transfer such amounts to consumers.
Trump's push to bring back manufacturing has also gone beyond smartphones. He has also pushed automakers, pharmaceuticals, and chip makers to return production to America. But moving phone assembly lines is a special challenge, since the U.S. does not yet have the infrastructure for large-scale phone manufacturing.
Based on an Associated Press news report, moving iPhone manufacturing to the U.S. would make a $1,200 device cost anywhere from $1,500 to $3,500.
Apple CEO Tim Cook recently signaled that a majority of iPhones being sold in the U.S. this quarter would be made in India, with iPads coming from Vietnam. The company, as many others, is dealing with the ambiguous landscape caused by Trump's changing trade policy.
Just recently, Trump protested Apple's increasing manufacturing bases in India. While delivering a speech in Qatar, he complained about the company's foreign expansion: "He is building everywhere in India. I don't want you building in India," Trump protested, even stating that Apple would be "increasing their production in the United States."
Apple has dramatically increased its production in India in the last year. The technology company allegedly produced $22 billion of iPhones in India — a 60% increase over the previous year — making India a key worldwide production hub in its attempts to diversify its supply chain.
