Trump’s Warning to Apple
Former US President Donald Trump has recently warned Apple Inc. that if the company does not move iPhone production to the United States for domestic sales, he will impose a 25% tariff on its products. This announcement has created a stir in the tech industry and has global economic implications.
Trump’s Statement and Reactions
On May 23, Trump posted on his Truth Social platform, saying, “I have already told Apple CEO Tim Cook that I want all iPhones sold in the US to be made in the US, not in India or anywhere else. If not, Apple will have to pay a 25% tariff.”
Following this announcement, Apple’s stock price dropped by 4% in pre-market trading, reflecting investor concern.
Apple’s Current Production Strategy
Apple currently manufactures iPhones in China and India. The company plans to move almost all iPhone production for the US market to India by 2026 to reduce its dependency on China.
However, Trump’s new tariff threat challenges this strategy. Experts believe that if Apple starts making iPhones in the US, the cost per phone could rise to around $3,500, and it may take 5–10 years to fully shift production.
Challenges of US-Based Production
The US lacks the infrastructure, skilled workforce, and supply chain needed for iPhone manufacturing. Apple’s current supply chain is centered in Asia, making relocation difficult. Also, higher production costs could increase product prices, affecting consumers.
Apple’s Investment Plans
Apple has announced it will invest $500 billion in the US over the next four years. This includes building a new factory in Texas, advancing tech research, and training workers. However, this investment is not focused on iPhone production but on servers and other tech products.
Market Impact and Future Outlook
Trump’s tariff threat has caused instability in the global market. Both European and US stock markets saw declines.
Analysts believe it’s not economically practical or realistic for Apple to manufacture iPhones in the US. However, this pressure may force the company to rethink its production strategy.
Conclusion
Trump’s tariff warning is a major challenge for Apple. While starting iPhone production in the US is difficult, the company may have to reconsider its approach. Only time will tell how this situation will evolve.