In a move likely to escalate the trade war between the United States, China, and the European Union, President Donald Trump has decided to impose tariffs on several countries around the world, including some in the Arab region. These new tariffs, which will take effect next week, will undoubtedly impact product prices for many companies, especially those in the Middle East. Camel Apple manufactures its devices outside the United States. In the following lines, we will review how Trump's tariffs will affect Apple product prices.
Apple products
Apple has taken steps to diversify its supply chain outside of الصين To include countries like India and Vietnam, the tariffs announced by the White House are expected to affect those countries as well. A 10% base tariff has been imposed on all imports into the United States, in addition to reciprocal tariffs targeting most of the countries Apple relies on to manufacture its various products. The following are the countries Apple relies on to manufacture its various products and their respective tariffs:
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Most of Apple's iPhones are still assembled in China by Foxconn, where about 80% of Apple's production capacity is located. It's estimated that 90% of iPhones are manufactured in China, while 55% of Macs and 80% of iPads are manufactured in China. Beijing will face a 34% tariff, in addition to the current 20% duty, bringing the effective tariff rate to 54%.
India
Over the past two years, Apple has made significant efforts to increase iPhone production in IndiaAs the government seeks to increase domestic manufacturing of high-tech goods, 10% of iPhones are currently assembled in India. The company plans to increase India's share of iPhone manufacturing to approximately 15 to 20% by the end of 2025. A 26% tariff will be imposed on Indian products.
Vietnam
Vietnam has emerged in recent years as a prominent manufacturing hub for consumer electronics. Apple has increased its production in the country. Currently, 20% of iPads are manufactured in Vietnam, along with 90% of Apple's wearable products, particularly its smartwatch. Vietnam is poised to face significant tariffs after Trump imposed a 46% tariff on its imports.
other countries
Malaysia is a growing Mac manufacturing location and will be subject to a 24% tariff. Thailand, a small Mac production center, will be subject to a 36% tariff.
Apple also sources components for its devices from South Korea (25% tariff), Japan (24% tariff), and Taiwan (32% tariff).
Ireland, which produces some iMacs, will be subject to a 20% tariff.
Apple manufactures the Mac Pro only in Texas.
It's worth noting that Apple will raise prices to offset the new tariffs. It's estimated that every 10% of the tariffs imposed could be offset by a roughly 6% increase in the average selling price of a product. Experts also predict that Apple will need to increase the prices of many of its products to offset the costs incurred by the tariffs, as follows:
- iPhone and Apple Watch prices: 43% increase.
- iPad prices: 42% increase.
- AirPods and Mac prices: 39% increase.
Thus, the iPhone 16e price will increase from $599 to $856, while the iPhone 16 Pro Max price will increase from $1599 to $2300.
Conclusion
Ultimately, it's clear that Donald Trump's return to power poses challenges and obstacles for Apple and other companies across all sectors. New tariffs will increase production costs, which will impact the prices of Apple's devices. Let's not forget the reaction of countries that may impose similar tariffs on American products, potentially sparking a global trade war.
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