The former president's pronouncements, made via a post on his Truth Social platform, sent ripples through the financial markets, wiping approximately $70 billion (£52 billion) off Apple's shares. In his post, Trump asserted, “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. If that is not the case, a Tariff of at least 25% must be paid by Apple to the US.” Following these comments, Apple shares saw a 2.6% decline, pushing the company’s valuation just below $3 trillion.
Trump's demand for domestic manufacturing is not limited to Apple. In remarks to reporters at the White House on Friday afternoon, he stated his intention to impose a similar 25% tariff on Samsung and any other phone manufacturer that produces phones outside the U.S., claiming that "it would not be fair" otherwise. He further incentivized domestic production, stating, “When they build their plant here, there’s no tariffs. So they’re going to be building plants here.”
This latest move comes after a period of fluctuating tariff threats from Trump. Last month, he initially alarmed Apple investors with a series of escalating tariff announcements on goods from China, where the vast majority of iPhones are assembled. These tariffs had ratcheted up to a potential total of 145%. However, just days later, his administration announced an exemption for smartphones and computers, seemingly providing a reprieve.
Soon after that exemption, reports emerged that Apple was already planning to shift the assembly of all iPhones destined for the U.S. market to India, an apparent strategy to mitigate the impact of Trump’s trade war with China. Apple’s CEO, Tim Cook, confirmed this shift during an earnings call this month, noting that the majority of iPhones sold in the U.S. for the June quarter would "have India as their country of origin." While Apple remains secretive about its detailed production processes, analysts estimate that approximately 90% of its smartphones are currently assembled in China.
Trump publicly rebuked Apple and Cook over the India shift earlier this month. “I had a little problem with Tim Cook,” he stated, adding: “I said to Tim … ‘we’ve treated you really good, we’ve put up with all the plants that you’ve built in China for years, now you got to build [for] us. We’re not interested in you building in India, India can take care of themselves … we want you to build here.’”
Analysts have consistently cautioned that relocating U.S.-bound iPhone production to the United States would be prohibitively expensive. They cite the lack of specialized facilities and the highly flexible workforce that Apple currently benefits from in China.
Financial services firm Wedbush Securities estimated last month that an iPhone manufactured entirely in the U.S. could cost more than three times its current price, potentially reaching $3,500, highlighting the immense economic challenges of such a domestic shift.