Quick overview

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Tim Cook, Apple’s Chief (AAPL), has been working to protect the tech giant from tariffs for years by reducing the company’s reliance on China and moving production to nations like Vietnam and India.

 

This strategy goes back to President Trump’s initial tariffs on Beijing. However, it now seems that that endeavor has encountered a well-known roadblock: Trump said, “I expect Apple’s iPhones that will be sold in the United States of America to be manufactured and built in the United States, not India, or anyplace else,” Trump stated in a Friday via Truth Social post.

 “Apple must pay the United States a tariff of at least 25 percent”.  The possibility of additional taxes strains Apple’s already precarious business strategy.

Early Friday, Apple stock lost more than $100 billion in market value after Trump declared that the iPhone manufacturer would have to pay a minimum 25% tariff unless its devices were manufactured in the United States. Despite this, China still controls about 85% of iPhones.

Apple invested in India and Vietnam to increase its manufacturing footprint, even though China still produces about 85% of iPhones. Apple has increased iPhone production in India to avoid Trump’s upcoming tariffs.

Foxconn and Tata airlifted a record $2 billion worth of devices to the US in March, just weeks before Trump’s announcement of Liberation Day

Apple said earlier this year that it would invest over $500 billion in the United States, along with supply chain diversification. Building a new server factory in Texas and employing 20,000 people are part of that.