Apple's stock fell after former U.S. President Donald Trump threatened to impose a 25 percent tariff on all Apple products that aren't made in the United States.
This threat, made on Trump's Truth Social platform on Friday, caused Apple’s stock to drop by 3.5 percent in futures trading, although it later bounced back by 2.8 percent during early market hours.
Trump's remarks focused on Apple’s global manufacturing approach, particularly its decision to move iPhone production to India. He stated, “I have long ago informed Tim Cook of Apple that I expect their iPhones that will be sold in the United States of America will be manufactured and built in the United States, not India, or anyplace else.” He added, “If that is not the case, a Tariff of at least 25% must be paid by Apple to the U.S.”
This proposal raised alarms among investors and analysts, with experts in the tech sector labeling the demand as 'unrealistic'
Dan Ives, a senior analyst at Wedbush Securities, mentioned that shifting iPhone manufacturing back to the U.S. could take five to ten years and would likely raise the price of an iPhone to about $3,500. He called the idea a “fairy tale.”
Barton Crockett, a senior analyst at Rosenblatt Securities, shared a similar view during his appearance on CNBC’s Squawk Box, referring to Trump’s proposal as “asking for the impossible.”
Trump's remarks seem to continue his long-standing trade issues with China, which previously prompted Apple to think about diversifying its production locations.
Apple CEO Tim Cook has said that the company is increasing manufacturing in India as part of that plan.
However, Trump expressed his dissatisfaction with this decision during a visit to Qatar last week, saying, “I had a little problem with Tim Cook… I said to him, ‘Tim, you’re my friend. I treated you very good. You’re coming in with $500 billion.’ But now I hear you’re building all over India. I don’t want you building in India.”