In response to “Liberation Day” tariffs imposed by the Trump administration, Apple is exploring strategies to mitigate consumer price increases. A 54% tariff affects iPhones assembled in China, while India faces a 26% levy and Vietnam has a 46% import fee. Mark Gurman from Bloomberg reports that Apple has been stockpiling products in the U.S. to avoid immediate price hikes, potentially delaying increases until the iPhone 17 launch in September. The company may absorb some costs by reducing hardware margins and is renegotiating contracts for better pricing. Additionally, Apple is expanding its manufacturing globally, including Brazil.
In response to the Trump administration’s “Liberation Day” tariffs, manufacturers like Apple are exploring strategies to alleviate the impact on consumers due to the forthcoming price increases. China, which is the primary assembly location for iPhones, faces a hefty 54% tariff, while India will incur a 26% tax, and products from Vietnam will be subjected to a 46% import duty when entering the U.S.
As reported by Bloomberg’s Mark Gurman, Apple has been building up its inventory of iPhones, Macs, and other products in the U.S. for several months in preparation for the new tariffs. The recently announced tariffs, set to take effect on April 9, will not affect devices that are already in the U.S., giving Apple the opportunity to postpone any price increases on iPhones until the release of the iPhone 17 series in September.
Additionally, Apple is ready to absorb a minor fraction of the costs by lowering its profit margins on hardware products. Typically, Apple’s hardware has a markup of around 45%. Similar to other companies, Apple is reportedly renegotiating contracts with its supply chain and manufacturing partners to secure better pricing on device components and assembly services.
Moreover, Apple is expanding its global manufacturing capabilities to new regions, with Brazil being one of the latest reported additions.
It has been more than seven years since Apple last raised the price of its flagship iPhone in the U.S.; the iPhone X was introduced in 2017 starting at $999. Unless a significant shift occurs in geopolitical matters, consumers should prepare for a notable price increase on the next generation of iPhones.
Source (paywall)