Trump Threatens 25 Percent Tariff on iPhones Without US Production

President Donald Trump has escalated his trade war rhetoric by threatening Apple with a 25% tariff on any iPhones sold in the U.S. that are not manufactured domestically. This ultimatum, posted on his social media platform Truth Social, demands that Apple move its production out of countries like China and India and back to the United States.

Apple currently produces about 90% of its iPhones in China, with additional manufacturing in India and other Asian countries. The company has been planning to shift some production to India to mitigate tariff impacts, but this move has drawn the ire of the president, who insists on U.S.-based manufacturing.

The threat has already affected Apple’s stock, which dropped 4% following the announcement. Analysts warn that relocating even a fraction of Apple’s supply chain to the U.S. would be a massive undertaking, potentially costing $30 billion and taking up to three years, with significant disruptions along the way.

This latest development highlights the complex interplay between trade policy and global manufacturing. While the Trump administration aims to revive American manufacturing and reduce dependency on foreign supply chains, the practical realities of modern electronics production pose significant challenges.

Apple CEO Tim Cook has maintained a working relationship with Trump, even donating to his inauguration fund, which has helped Apple secure some tariff exemptions in the past. However, the president’s insistence on domestic manufacturing now threatens to upend Apple’s carefully balanced global supply chain.

Experts like Dan Ives of Wedbush Securities emphasize the scale of the challenge: moving significant production to the U.S. would require billions in investment and years of work, with potential disruptions to product availability and pricing. Meanwhile, Treasury officials acknowledge the goal of boosting U.S. manufacturing but admit the timeline and feasibility remain uncertain.

This situation serves as a case study in how geopolitical ambitions and protectionist policies can clash with the realities of globalized tech manufacturing. For Apple and similar companies, balancing cost, efficiency, and political pressures is becoming an increasingly delicate act.

As the trade war continues to evolve, companies must stay agile and informed. Understanding the implications of tariffs and supply chain shifts is critical to maintaining competitiveness and managing costs in a volatile global market.