Apple is considering expanding iPhone procurement in India, where tariffs are relatively low, to avoid the mutual tariff impact imposed by the Donald Trump administration on China.
Citing sources, the Wall Street Journal (WSJ) reported on the 7th that Apple plans to increase the number of iPhones it is procuring from India to the United States.
Apple reportedly considered the current situation uncertain to change its long-term plans and envisioned the plans as a short-term temporary measure while exploring tariff exemptions for the Trump administration.
U.S. President Donald Trump imposed 25% tariffs on Chinese products in 2019 during his first term in office, but he exempted Apple from tariffs by persuading Apple CEO Tim Cook.
According to Bank of America analyst Wamsi Mohan, Apple plans to produce about 25 million iPhones in India this year. Of these, 10 million will be mostly supplied to the Indian market. If Apple sends all of its iPhones produced in India to the U.S., it will be able to meet about 50 percent of the demand for iPhones in the U.S. this year.
President Trump imposed 34% on China and 26% on India at the mutual tariff rates of each country, which will take effect on the 9th. In addition to the 20% tariff imposed earlier, China will be subject to a total of 54% tariffs. As a result, the hardware cost of the ‘iPhone 16 Pro’, which is currently sold for $1,100, could increase from $550 to $850.
Apple’s stock price, which is highly dependent on production in China, is directly hit by the announcement of mutual tariffs on the 2nd. In the three days after President Trump’s tariff announcement, it fell 19% and its market capitalization evaporated by $638 billion.
SAM KIM
US ASIA JOURNAL
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