Trump Tariffs Could Drive Up iPhone Price

In January, we predicted that Trump's proposed tariffs on Chinese imports could drive up the price of your gadgets. Yesterday, however, a New York Times report claimed that the Trump administration will not place tariffs on iPhones assembled in China.

But today, Peter Navarro, White-House trade advisor and director of the White House National Trade Council, told CNBC that he has no knowledge of an iPhone exemption in Chinese tariffs. This casts doubt on previous reports and means Apple could, once again, be in trouble. 

Credit: Getty

(Image credit: Getty)

It's hard to know how exactly such a tariff would impact consumer prices. Navarro believes that the 10 percent tariff level (as of the White House's last statement) won't have a huge impact on the price for consumers. Still, Apple has a large Chinese consumer base and manufacturing infrastructure, and Tim Cook's past efforts to prevent such actions by the administrations suggest they could have notable consequences for the company.

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Apple has 41 stores in China, and has sold hundreds of millions of iPhones there. That's a small amount compared to its presence in some countries (Apple has opened 272 retail stores in the U.S. since May 2001) but it's still solidified Apple as a major technology player.

While Apple's sales saw a decline early this year, the company still remains the fifth-from-top smartphone manufacturer in the region, losing turf only to domestic players including Huawei, Vivo, Oppo, and Xiaomi. And Apple's business in China garners an annual revenue of around $50 billion per year, which is just under a quarter of what the company takes in worldwide.

Last month, the Apple CEO visited the White House to warn the President that his trade war could threaten Apple's business in the region. And in March, he called for "calmer heads" between the two countries, according to the Times.

And even if the tariff doesn't significantly harm Apple's bottom line, the company still fears that the trade war will. The Times also reported that anonymous sources close to Apple claim the company worries China will "retaliate in ways that hamstring its business." Increased scrutiny from the Chinese government, for example, could also increase the time and resources necessary to manufacture an iPhone.

Monica Chin is a writer at The Verge, covering computers. Previously, she was a staff writer for Tom's Guide, where she wrote about everything from artificial intelligence to social media and the internet of things to. She had a particular focus on smart home, reviewing multiple devices. In her downtime, you can usually find her at poetry slams, attempting to exercise, or yelling at people on Twitter.

  • Ron_101
    awwww poor Apple.
  • schjimsu
    @RON_101 - I know, right?
  • katanaguy
    Apple products are the most over rated technology products on the planet, and no I have no grudge against them, I have owned some of their products and deduced this from experience. I know the young people greatly enjoy them and its the "cool" factor thats in play here a lot, yet it is their money and decision and I simply say to each his own.
  • kd8fup.hf
    Apples the worst, GO ANDROID!!!!!!!
  • bettigolen
    In many respects, I agree with you Katanaguy. However, if you are in any capacity in Sales, Marketing, Education, and so many other industries, it is almost imperative that you use it. I beg to differ on the young people argument. I am 46, and I find more young people now are using Samsung and trying other brands.

    Believe me, I switched about 5 years ago to Apple because the other technology was just not cutting it. I do hope that more people in my industry do switch so that we can support other brands.
  • pocketchange
    Mercy, talk about smoke and mirrors. It's a little hard to believe Navarro has no info into White House activity.
    Your listing of the other cell phone producers is a little off base, considering they are all produced in China.
    As for CNBC, I find difficult to believe most anything they disperse, based on their past efforts..

    Please don't tell me this operation is politically motivated. What's next? pc
  • inzane4all
    You think the fanboys/girls will care? Apple made a mistake by introducing 3 models this time around (iPhoneX). They pushed their luck, and it bit them back. The iPhoneX is ridiculously priced and not worth it. But since there are two other models to choose from, people left the X high and dry and chose the mid to lower end phones. Go back to 2 model phones only, priced at $799 or $899 for the high end model, and people will line up like sheep to get the overpriced tech that probably costs $150 to make.

    I used to be a STRONG Apple supporter, going back as far as MacOS 7.6.1 (I can even go even further back) and only using, managing and recommending Apple products. Once prices for Apple hardware went ridiculously high (starting with the iPhone), I completely switched to Linux, Android or Microsoft.
  • webgtlnbrgrs
    I hope this site isn't going to turn Political .. APPLE raises the prices all by themselves just fine, my X cost a $1000.00 who's fault was that ??? Come on this crap it "MAY" increase prices, well MAY not, stick on point will you …
  • brightjh01
    using slave labor has caught up to them.
  • bwest.devore37
    maybe if they didn't come out with new ones so often..