Experts: U.S. tariff policies may result in iPhones being made in the U.S., with prices possibly soaring to NT$80,000.

Taiwan • Business • 04/12 05:08
Experts: U.S. tariff policies may result in iPhones being made in the U.S., with prices possibly soaring to NT$80,000.

On April 12, 2025, the 145% reciprocal tariff policy promoted by President Trump of the United States posed a significant challenge to Apple Inc. Oliver, an economist at AMP in Australia, pointed out that if Apple moves its iPhone production line back to the U.S., the price could skyrocket to $2,519. This policy pressures Apple to restructure its supply chain and could potentially cut its annual profit by $40 billion. Economists warn that the risk of a U.S. recession has increased to 45%. Apple is taking steps to address this, such as expanding production in India and offering installment plans.

Key Updates

04/12 07:37

US-China Chip Tariff Dispute Escalates: Imposition of High Tariffs by 2025 Causes Global Market Turmoil and Price Hikes

In April 2025, President Trump of the United States imposed a 145% tariff on chips imported from China, and China countered with a 125% tariff on chips from the United States, leading to upheaval in the global semiconductor market. The prices of Chinese chips skyrocketed, resulting in a wave of panic buying, and many distributors halted price quotations. China's new regulation regards the wafer fabrication site as the place of origin, affecting U.S. manufacturers such as Intel and forcing companies to reevaluate their supply chain arrangements.

04/12 06:39

Escalation in the US-China Trade War: US Imposes 145% Tariff on Chinese Goods, China Retaliates with a 125% Tariff, Global Markets in Turmoil

On April 12, 2025, the US-China trade war intensified, with the US imposing a total tariff rate of 145% on Chinese products, and China retaliating with a 125% rate. This led to disruptions in global supply chains and financial markets. Taiwanese manufacturers experienced a surge in orders, air freight space was fully booked, and the Taiwan stock market experienced significant volatility. The US temporarily suspended reciprocal tariffs for 90 days on 75 countries, with Taiwan included in the first round of negotiations, requiring only a 10% tariff rate, prompting Taiwanese electronics and semiconductor companies to speed up shipments.

04/12 06:39

Trump's announcement of high tariffs has led to an escalation in the US-China trade war, causing volatility in global stock markets, resulting in Taiwan's stock market experiencing its largest drop in history.

In April 2025, President Trump of the United States imposed a 145% tariff on Chinese goods, and China retaliated by raising tariffs on American goods to 125%, escalating the U.S.-China trade war. Global stock markets were severely shaken, with Taiwan's stock market experiencing its largest single-day drop. Trump imposed a 32% tariff on Taiwanese goods, dealing a severe blow to exports, prompting the government to launch an NT$88 billion support plan. The U.S. dollar depreciated amid risk aversion, hitting new lows against the euro, yen, and Swiss franc. Taiwanese companies faced pressure to redirect orders and relocate production.

04/12 06:07

In 2025, the US-China tariff war heats up: India could be the winner, Taiwanese stocks soar, and Taiwanese businesses in Vietnam are under pressure.

In April 2025, the US-China trade war intensified as President Trump imposed a 145% tariff on Chinese goods, and China retaliated by raising its tariffs to 125%. This move caused global market turmoil and led to a conservative outlook for the US economy. Expectations for a Federal Reserve rate cut increased, which benefited long-term bonds. China initiated a plan to shift exports to domestic sales, and Taiwan's stock market rebounded thanks to the intervention of the National Stabilization Fund and favorable trade negotiations. Taiwanese businesses in Vietnam faced pressure from a 46% tariff and actively engaged in negotiations to adjust their strategies. India, with its low export dependency and flexible policies, was considered a potential beneficiary.

04/12 05:08

President Trump of the United States delays reciprocal tariffs by 90 days: begins trade talks with Taiwan and 15 other countries, with the goal of reaching 90 agreements.

On April 9, 2025, President Trump of the United States announced a 90-day pause on high reciprocal tariffs for most trade partners, excluding China, imposing only a 10% standard tariff rate. This decision was made in response to the willingness of 75 countries to negotiate. The Trump administration aims to finalize 90 trade agreements during this period, with Taiwan being part of the first round of negotiations, and a video conference with the United States set for April 11. Even though China is not on the suspension list, Trump remains optimistic about negotiating an agreement with China.

04/12 05:08

Experts: U.S. tariff policies may result in iPhones being made in the U.S., with prices possibly soaring to NT$80,000.

On April 12, 2025, the 145% reciprocal tariff policy promoted by President Trump of the United States posed a significant challenge to Apple Inc. Oliver, an economist at AMP in Australia, pointed out that if Apple moves its iPhone production line back to the U.S., the price could skyrocket to $2,519. This policy pressures Apple to restructure its supply chain and could potentially cut its annual profit by $40 billion. Economists warn that the risk of a U.S. recession has increased to 45%. Apple is taking steps to address this, such as expanding production in India and offering installment plans.

04/12 04:38

First Round of Taiwan-US Tariff Negotiations Begins: Taiwan as the Initial Focus, Focusing on Economic and Trade Barriers and Export Controls

On April 11, 2025, Taiwan and the United States commenced the first round of tariff negotiations via video conference, discussing issues such as reciprocal tariffs, non-tariff trade barriers, and export controls. The Taiwanese team was led by Executive Yuan Deputy Premier Cheng Li-chun (Lily Cheng) and Chief Negotiator Jenny Yang. Taiwan, along with Israel, was included in the first wave of negotiations by the U.S., indicating the U.S.'s acknowledgment of Taiwan's strategic importance. Both parties will continue negotiations during the 90-day tariff suspension period, with the aim of establishing a strong economic and trade relationship between Taiwan and the U.S.

04/12 03:36

The first round of the Taiwan-US tariff and trade barrier video conference is underway, with a focus on reciprocal tariffs, non-tariff barriers, and export controls.

On April 11, 2025, the trade negotiation teams from Taiwan and the United States held their first virtual meeting to discuss issues such as mutual tariffs, non-tariff barriers, and export controls. Taiwanese President Lai Ching-te highlighted Taiwan's inclusion in the U.S.'s initial negotiation list and proposed starting with "zero tariffs" as a concept. Both parties agreed to begin further consultations in the near future to enhance economic and trade cooperation between Taiwan and the U.S.

04/12 03:36

Trump's tariff policy causes an 11.2% increase in March car sales, experts warn of the risks of panic buying, Wall Street executives express opposition.

At the beginning of April, President Trump initiated a high tariff policy on imported goods, resulting in an 11.2% increase in car sales in March as consumers bought goods in advance to avoid price hikes. Experts warn that this panic buying might put pressure on household finances. Many financial leaders on Wall Street oppose the tariff policy, worrying it could slow down economic growth and trigger market volatility. Under pressure, the Trump administration has postponed the implementation of some tariffs, but the 25% tariff on goods such as cars has already taken effect, putting pressure on consumers and businesses as they face rising costs.

04/12 02:40

US-China Trade War Intensifies: Tesla Stops Selling Imported Models, Sharp Decline in Cargo Ship Bookings Disrupts the Supply Chain

The intensification of the US-China tariff war is impacting the automotive and shipping industries. Tesla in China has stopped accepting new orders for US-manufactured Model S and Model X cars and is only selling existing inventory. Shipping bookings from Chinese ports to the US have sharply decreased, with nearly no ships departing from Shanghai to the US. US ports are congested, leaving thousands of imported cars stranded, and some car manufacturers are delaying shipments to manage tariff uncertainties. This trade conflict is reshaping the operations of global automotive and logistics supply chains.

The Cost of Made in America: iPhone Costs Skyrocket

According to estimates by Wedbush Securities analyst Dan Ives, if the iPhone were entirely manufactured in the United States, the cost per unit would reach $3,500, more than triple the current cost. This figure reflects the U.S.'s deficiencies in manufacturing technology, industrial clusters, and labor force density. Currently, about 90% of iPhones are assembled in China, a supply chain structure that is the result of Apple's significant investments in China over the past 25 years.

Oliver further pointed out that, for example, the current suggested retail price of the iPhone 16 Pro in the U.S. is about $1,100, but if production were fully relocated to the U.S., the price would rise to $2,519. This price surge is mainly due to the high labor costs in the U.S. and the lack of large-scale manufacturing capabilities.

Price Pass-Through Under Tariff Pressure

In addition to production costs, import tariffs also place a heavy burden on Apple. Oliver noted that the current import cost of the iPhone 16 Pro is approximately $580, and with a 145% tariff, the cost would soar to $1,340. If Apple chooses to maintain its original retail profit margin, the price would rise to $1,860. This means Apple faces a dilemma: either compress its own profits or pass the costs onto consumers.

According to estimates by Rosenblatt Securities, this wave of tariffs could lead to a $40 billion reduction in Apple's annual profits. As a result, Apple has urgently airlifted about 1.5 million iPhones from India to the U.S. to meet short-term market demand and price pressures.

Bottlenecks and Adjustment Difficulties in the Global Supply Chain

Apple's supply chain is highly dependent on China. It is estimated that the assembly of an iPhone involves over 1,000 components, most of which come from China. Apple suppliers depend on China's low-wage labor force of 300 to 500 million people, a scale almost equivalent to the entire U.S. population. During the holiday season, these workers are crucial for achieving a daily production of one million iPhones.

Although Apple has begun shifting some production to India and Vietnam, the capacity and technology in these regions cannot fully replace China. The Trump administration also imposed tariffs of 46% and 27% on imports from Vietnam and India, respectively, further limiting Apple's room for adjustment.

Economists Warn: Increased Risk of U.S. Recession

Oliver cautions that the current policy uncertainty in the U.S., coupled with supply chain instability and declining market confidence, has raised the risk of a U.S. economic recession to 45%. He pointed out that if Apple and other tech giants cannot effectively respond to the tariff impact, it will cause a chain reaction on the overall economy.

This view is echoed by financial industry leaders. JPMorgan Chase CEO Jamie Dimon stated that the economy is facing "considerable turbulence," while BlackRock CEO Larry Fink bluntly said that the U.S. economy "may already be in a recession." Wells Fargo CEO Charlie Scharf urged the government to quickly seek solutions to stabilize market expectations.

Apple's Response Strategy and Future Challenges

In response to tariff and cost pressures, Apple is taking several measures. According to Morgan Stanley analyst Erik Woodring, Apple may expand its production capacity in India and offer longer-term installment plans through Apple Card to reduce consumers' monthly payment pressure. Additionally, Apple might direct demand towards higher-margin models or mitigate the impact through supply chain negotiations and pricing strategies.

However, whether these strategies can be effective in the short term remains to be seen. Apple CEO Tim Cook successfully lobbied for tariff exemptions during Trump's first term, but facing higher tariffs and a stricter policy environment this time, Apple's room for maneuver has significantly shrunk. According to The New York Times, Apple's stock price has evaporated by over $1 trillion since the end of last December, indicating market uncertainty about its future.

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People Also Ask...

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If the iPhone were actually made in the United States and its price shot up to 80,000 New Taiwan Dollars, would that affect your decision to buy it?

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If iPhones were actually made in the United States and their price shot up to 80,000 NTD, how would this affect Apple's sales and stock price?

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If the iPhone were actually made in the USA, would the price be too expensive for people to buy?