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Trump’s reciprocal tariff will undo Apple’s years of supply-chain diversification work. Photo: Apple TV+
President Trump’s new import tariffs will hit Apple hard. The President slapped all major manufacturing countries with heavy import tariffs.
This move undermines Apple’s efforts in recent years to diversify its supply chain away from China. The reciprocal tariffs will go into effect starting April 9.
Trump imposes hefty reciprocal tariffs on Apple’s production hubs
After months of warnings, the White House announced reciprocal tariffs on imports from countries that impose steep taxes on US goods. They targeted every country where Apple manufactures its products. They have been hit with tariffs ranging from 20% to as high as 46%.
A Bloomberg report highlights the reciprocal tax on countries where Apple has a notable manufacturing presence:
China: an additional 34%, bringing the total tariff to 54%
Ireland: 20%
India: 26%
Japan: 24%
Malaysia: 24%
Taiwan: 32%
Thailand: 36%
Vietnam: 46%
India has become a major iPhone manufacturing hub for Apple in recent years, with the company looking to double its production there within two years. Similarly, TSMC’s facility in Taiwan manufactures Apple Silicon for Macs, as well as the A-series chips powering iPhones. Apple assembles AirPods, MacBooks, and Apple Watch in Vietnam, which Trump has slapped with a 46% tariff.
Will Apple raise its prices in the US to account for the tariffs?
These tariffs will deal a blow to Apple, effectively undoing years of effort to diversify its supply chain away from China in preparation for a potential trade war. The tariffs are also so high that Apple cannot absorb their impact by reducing its margin. It may have to adjust the pricing of all its popular products — iPhone, iPad, and Macs — to account for the higher tariff.
During President Trump’s first term, Apple secured a tariff exemption, allowing its imports from China to avoid additional taxes. This time, however, Trump has stated he has no plans to grant such exemptions. This is despite Apple’s recent pledge to invest a record $500 billion in the US over the next four years.
With a few days still left before the reciprocal tariff kicks in, there’s a possibility the President will back out of his decision at the last minute.
