Trump Gives Christmas Gift to Apple
U.S. President Donamd Trump delivered an early Christmas present to Apple as he signed off on a trade deal with China that would add 15% tariffs on iPhones, iPads and MacBooks.
The new import duties were due to start Dec. 15 and could have added about $150 to the price of iPhones during the crucial holiday shopping season.
Holding product prices steady while absorbing additional tariffs would have an impact in Apple's earnings per share.
Apple already is paying duties on the Apple Watch, AirPods headphones, iMac desktop computer and HomePod speaker. Some of those levies may be rolled back.
The deal presented to Trump on Thursday included a promise by the Chinese to buy more U.S. agricultural goods. Officials also discussed possible reductions of existing duties on Chinese products, according to uncofirmed reports.
However, the ongoing trade war has exposed a weakness at the heart of Apple’s business. The world’s largest technology company relies on suppliers and manufacturing partners that are mostly based in China. Apple can’t quickly move production to other countries, so the company is currently relying on White House lobbying campaign to protect its key products from tariffs.
During a recent apperance at a Mac Pro assembly facility in Texas last month, Trump said that it wasn't fair for Apple to be taxed on iPhones built in China given that South Korean rival Samsung Electronics wouldn’t have to pay the duties.