Trump's Tariff Policies Trigger a 2025 US-China Trade War: Taiwanese Manufacturers Adjust Strategies, Apple Moves Production to India

Taiwan • Business • 04/08 18:09
Trump's Tariff Policies Trigger a 2025 US-China Trade War: Taiwanese Manufacturers Adjust Strategies, Apple Moves Production to India

In April 2025, U.S. President Donald Trump announced punitive tariffs of up to 104% on Chinese goods, sparking a new round in the U.S.-China trade war. China immediately retaliated with countermeasures, disrupting global supply chains and shaking market confidence. Taiwanese contract manufacturers shifted their operations to Vietnam and Mexico, and Apple accelerated its shift of iPhone production to India. A buying frenzy for PCs and iPhones broke out in the U.S. market as consumers feared imminent price hikes, leaving businesses and investors facing uncertainty.

Key Updates

04/08 23:36

The United States imposed a 104% tariff on China effective April 9, as the Trump administration launches negotiations for multilateral trade agreements.

On April 9, 2025, the total tariffs imposed by the United States on imports from China reached 104%, as ordered by President Trump in response to China's refusal to withdraw its 34% retaliatory tariffs. White House spokesperson Li Weit called this a "strong counterattack." Meanwhile, the Trump administration has initiated negotiations for "tailored" trade agreements with nearly 70 countries, with delegations from Japan and South Korea already in the U.S. for talks.

04/08 23:09

US-China Trade War Heats Up: US Imposes New Tariffs on Asian Manufacturing, Apple Considers Shifting iPhone Production to India, US and Taiwan Stock Markets Plunge

On April 9, 2025, U.S. President Donald Trump initiated the "Reciprocal Tariffs" policy, imposing high tariffs on goods from 60 countries, with Chinese goods facing a 54% rate and Taiwanese goods 32%, respectively. In response to pressure from increased costs, Apple plans to shift part of its iPhone production to India. This move caused a market reaction, with U.S. stocks plummeting and Apple's stock price dropping 19% within three days, resulting in a $638 billion loss in market value. Taiwan's technology and semiconductor supply chains were impacted, with the Taiwan stock market dropping more than 2,000 points and TSMC's stock price falling nearly 4%. The Taiwanese government initiated an NT$88 billion support plan to address the challenges.

04/08 22:09

The US-China trade war heats up: The US imposes a 104% tariff on Chinese goods, leading to significant fluctuations in US stocks; China responds by cutting reserve requirements and interest rates.

On April 9, 2025, the United States imposed a 104% total tariff on Chinese goods, escalating U.S.-China trade tensions and causing fluctuations in global markets. U.S. stocks were highly volatile that day, with the Dow Jones Industrial Average dropping 320 points. The Chinese government swiftly responded by devaluing the yuan, lowering reserve requirements and interest rates, and implementing housing market stabilization policies to support the economy. Concerns over a global economic recession intensified, as JPMorgan raised the recession probability to 60%.

04/08 20:40

Former President Donald Trump Announces Global Mutual Tariff Policy, Analysis Reveals It Is Not Truly Mutual

On April 2, 2025, former U.S. President Donald Trump announced a global "reciprocal tariffs" policy at the White House, describing it as a move to achieve trade fairness. However, according to data from the WTO and analyses by economists, these tariffs do not truly adhere to the principle of reciprocity but are based on bilateral trade deficits, imposing tariffs on multiple countries that are higher than the rates those countries impose on the U.S. This policy has sparked criticism for deviating from traditional reciprocal trade principles and has been accused of being aimed at eliminating the U.S. trade deficit.

04/08 19:08

The United States imposes a 26% tariff on goods from India, Taiwanese businesses temporarily halt shipments to the United States, while the domestic market in India bolsters confidence.

On April 3, 2025, U.S. President Donald Trump announced a 26% import tariff on Indian goods, impacting Taiwanese companies that have factories in India, leading some Taiwanese businesses to temporarily halt shipments to the U.S. India's strong domestic market supports the operations of these Taiwanese businesses. The Indian government has decided not to take retaliatory measures and is actively negotiating with the U.S. to pursue a bilateral trade agreement. The Indian Minister of Commerce and Industry convened a meeting to address the tariff impact, making bilateral trade negotiations a key area of focus for future developments.

04/08 18:09

Trump's Tariff Policies Trigger a 2025 US-China Trade War: Taiwanese Manufacturers Adjust Strategies, Apple Moves Production to India

In April 2025, U.S. President Donald Trump announced punitive tariffs of up to 104% on Chinese goods, sparking a new round in the U.S.-China trade war. China immediately retaliated with countermeasures, disrupting global supply chains and shaking market confidence. Taiwanese contract manufacturers shifted their operations to Vietnam and Mexico, and Apple accelerated its shift of iPhone production to India. A buying frenzy for PCs and iPhones broke out in the U.S. market as consumers feared imminent price hikes, leaving businesses and investors facing uncertainty.

04/08 16:40

Trump's tariff policy for 2025 sparks a buying frenzy across the US, and Thai restaurants are facing high cost pressures.

On April 2, 2025, President Trump of the United States announced a baseline tariff of 10% on all imported goods and imposed a maximum punitive tariff of 104% on countries such as China, resulting in a buying frenzy among American consumers. Prices of food, appliances, and clothing are expected to increase by 10% to 30%, and Thai restaurants are facing a 36% tariff pressure due to imported ingredients. This policy has caused market uncertainty, an increase in import costs for businesses, increased consumer spending, and sparked controversy over the formula used to calculate the policy.

04/08 15:10

U.S.-China Trade War Escalates: U.S. Treasury Secretary Criticizes China's Mistakes, Volatility Index (VIX) Soars to 60, Sparking Market Panic

On April 8, 2025, U.S. President Donald Trump announced a comprehensive tariff policy, causing turmoil in global financial markets. U.S. Treasury Secretary Scott Besant criticized China's retaliatory tariffs, stating that China is at a disadvantage in the trade war. Euronext CEO Stéphane Boujnah warned that U.S. policy makes the U.S. resemble an emerging market, leading to capital outflows. The VIX, the U.S. stock market's fear index, surged above 60, hitting its highest level since 2020, and market experts urged for policy measures to stabilize investor confidence.

04/08 14:43

Trump's flawed tariff policy triggers backlash from U.S. companies: Apple moves iPhone production to India, reconstruction costs in Los Angeles skyrocket

In April 2025, former U.S. President Trump announced the implementation of "reciprocal tariffs" on multiple countries, with rates ranging from 10% to 54%. The American Enterprise Institute pointed out that the White House used an incorrect formula, causing the rates to be overestimated by a factor of four, leading to a backlash from businesses. Apple plans to produce 25 million iPhones in India to reduce costs; toy company BasicFun is facing pressure to raise prices. Reconstruction efforts after the Los Angeles wildfires have become more costly due to increased lumber tariffs.

04/08 13:12

An American think tank has revealed a tariff miscalculation by the Trump administration: The actual tariff rate for Taiwan, Japan, and South Korea should be 10%. The EU urges negotiations between the US and China to resolve trade disputes.

On April 2, President Trump of the United States announced the imposition of "reciprocal tariffs" on several countries around the world. However, Brent Neiman, an economist from the American Enterprise Institute and the University of Chicago, revealed that the Trump administration made errors in tariff calculations, resulting in the tariff rates for countries like Taiwan, Japan, and South Korea being overestimated by four times, when they should actually be 10%. European Commission President Ursula von der Leyen and Chinese Premier Li Qiang had a call, urging the resolution of trade disputes caused by U.S. tariffs through negotiations and expressed support for a fair and free international trade system.

US-China Tariff War Heats Up: Trump Imposes Punitive Tariffs

On April 2, US President Trump announced a 34% "equivalent tariff" on Chinese goods. China immediately retaliated by imposing the same rate on US goods. On April 7, Trump further threatened that if China did not withdraw its retaliatory tariffs, the US would impose an additional 50% punitive tariff starting April 9, bringing the total tariff on some Chinese goods to 104%. Trump stated on social media that this was a response to China's long-term currency manipulation, corporate subsidies, and trade barriers.

China, through state media and the Ministry of Commerce, strongly criticized the US for "compounding mistakes" and stated they would "stand firm." The hardline stances of both sides have drastically reduced the room for negotiation, raising concerns in the market about the stability of the global supply chain.

Taiwanese OEMs Activate Contingency Plans: Shifting to Vietnam and Mexico

In response to the escalating US-China tariff war, Taiwanese OEMs have quickly activated contingency plans. Golf equipment OEMs like Fusheng Precision, Ming An, Datian, and Juming, which have a high market share in the US, have begun accelerating their production capacity in Vietnam and are monitoring the progress of US-Vietnam tariff negotiations. Fusheng Precision noted that brands have not yet asked for price cuts and are still observing the situation; Datian admitted that although the US market accounts for only 30-40% of its revenue, 50% of its brand partners' revenue comes from the US, which could still be affected.

In the electronics OEM sector, companies like Inventec, Wistron, and Quanta are shipping to the US from their Mexican facilities to comply with the US-Mexico-Canada Agreement (USMCA) and avoid high tariffs. Inventec, which established a plant in Texas as early as 1995, still has operational production lines, providing an advantage for rapid production shifts. Wistron and Quanta stated that current shipments are unaffected and will adjust production capacity based on future tariff changes.

Apple Accelerates Manufacturing in India: Short-term Tax Avoidance, Long-term Strategy

In response to the escalating US-China tariff war, Apple has initiated a short-term contingency plan to export more iPhones from India to the US. According to The Wall Street Journal, Apple airlifted five planes full of iPhones from India to the US within three days at the end of March, completing customs clearance before the new tariffs took effect.

TechInsights estimates that if imported from China, the hardware cost of the iPhone 16 Pro would increase from $550 to $850; importing from India could halve the cost increase. Bank of America analysts estimate that Apple will produce about 25 million iPhones in India this year, which, if all exported to the US, could meet about 50% of the US market demand.

Foxconn, as Apple's main OEM partner, is also expanding its production capacity in India. Its Indian subsidiary announced in early April the procurement of over $32 million in equipment from Apple, interpreted as preparation for capacity expansion.

US Market Reaction: Anticipated Price Hikes for PCs and iPhones Trigger Buying Frenzy

Trump's tariff policy has sparked a strong reaction in the US consumer market. According to UBS estimates, the price of the iPhone 16 Pro Max could rise by $350, nearly a 30% increase, potentially reaching $2,300. PC products face similar pressure, with prices expected to rise by 35%. As a result, Apple stores across the US have seen a buying frenzy, with consumers rushing to upgrade their devices in anticipation of price hikes.

Apple employees report that the store atmosphere resembles a holiday shopping peak, with "almost every customer asking if prices are about to go up." Since current sales are mostly from previous stock, the tariff impact is expected to manifest in the next quarter.

PC brands like ASUS and Acer have stated they have stocked up in advance and are closely monitoring policy changes. ASUS noted that it will dynamically adjust inventory management, supply chain configuration, and pricing strategies. Retailers expect that if stock runs out, subsequent product prices will rise across the board.

Investors and Companies Face Uncertainty

Trump's tariff policy not only impacts corporate operations but also severely affects financial markets. Apple's stock price fell 19% over three trading days, losing over $600 billion in value. The Taiwanese stock market was also affected, with the TAIEX plummeting for two consecutive days, hitting a 14-month low.

According to analysis by China International Capital Corporation, equivalent tariffs will push US inflation up by 1.9 percentage points and could reduce GDP growth by 1.3 percentage points. US companies and consumers will face rising cost pressures, and market volatility is expected to persist in the short term.

References

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