Washington DC: US President Donald Trump has warned Apple that iPhones sold in the United States must be manufactured domestically or face a 25 percent tariff.
The statement, posted on his Truth Social platform, wiped nearly $70 billion off Apple’s market value as shares fell by 2.6 percent, pushing the company’s valuation below $3 trillion.
Trump said he had already informed Apple CEO Tim Cook of this expectation and that iPhones assembled in countries like India or elsewhere would be subject to the new tariff unless Apple relocates its production to the US. “If that is not the case, a Tariff of at least 25 percent must be paid by Apple to the US,” Trump wrote.
The policy would not apply only to Apple. Trump has stated at the White House that Samsung and other phone makers producing outside of the US would face similar tariffs. “When they build their plant here, there’s no tariffs,” President said, stressing that all manufacturers must establish domestic production facilities to avoid penalties.
This warning follows previous tariff threats issued by Trump on goods imported from China, where most iPhones are currently assembled. The tariffs on Chinese goods had climbed as high as 145 percent, raising investor concerns. However, the administration later granted an exemption for smartphones and computers.
In response, Apple reportedly began shifting assembly of iPhones for the US market to India, a move designed to sidestep the effects of the ongoing trade war between the US and China.
Apple CEO Tim Cook confirmed during a recent earnings call that the majority of iPhones sold in the US during the June quarter would have India as their country of origin. Analysts estimate that currently, about 90 percent of iPhones are assembled in China.
Despite the move, Trump publicly criticized Apple’s continued foreign manufacturing. The President said that, “I had a little problem with Tim Cook,” recounting that he told the CEO that, “We’ve treated you really good… now you got to build [for] us. We’re not interested in you building in India, India can take care of themselves … we want you to build here.”
Experts have cautioned that manufacturing iPhones in the US could be prohibitively expensive. A report by Wedbush Securities estimated that a US-made iPhone could cost over three times the current price, possibly reaching $3,500 due to a lack of comparable facilities and a flexible workforce like that available in China.
Apple’s largest market for iPhones is the United States, where it sells over 60 million units annually.
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