Apple Already 'Escaped' Trump's Tariff Once, But Can They Do It Again This Time?
2min read Trump's newly announced tariff policy on the 2nd struck apple like a heavy blow.
In after-hours trading, Apple's stock price once plummeted as much as 7.1%. If this decline continues into today's regular trading session, it would mark Apple's worst single-day performance since September 3, 2020.
The steep drop reflects investor concerns over Apple's supply chain being hit by tariffs, which could squeeze profit margins and drive up product costs. Unlike some of its peers, Apple operates no factories in the U.S., with nearly all of its products manufactured overseas. This makes the company particularly vulnerable under Trump's new tariff regime.
Ask Aime: What impact will Trump's new tariff policy have on Apple's stock and supply chain?
During Trump's first term, Apple strategically shifted some of its production to Vietnam (for iPads and AirPods) and India (for iPhones) to avoid additional tariffs under the Trump administration.
However, under Trump's latest reciprocal tariffs, these shrewd moves may backfire. The next steps for Apple will be closely watched by the outside world.
On Wednesday, Trump signed two executive orders at the White House announcing a 10% minimum baseline tariff on trade partners and imposing higher tariffs on certain countries—26% on India and a staggering 46% on Vietnam.
Compared to other U.S. tech giants, Apple is significantly more affected by the new tariff policy. At the time of reporting, Apple's pre-market stock price had dropped over 7%, while Nvidia and Tesla fell more than 4%.
Trump has repeatedly stated that he will not allow any product exemptions, meaning Apple must either absorb the costs (hurting profits) or pass them on to consumers through price hikes.
Over the past two years, Apple has aggressively expanded iPhone production in India as the government pushes for more local high-tech manufacturing. In January 2023, India's Commerce and Industry Minister Piyush Goyal stated that Apple aimed to produce about 25% of the world's iPhones in India by 2023—though the actual results fell short.
Analysts at Bernstein estimate that by the end of 2025, India could account for 15% to 20% of Apple's total iPhone production. Evercore ISI reports that currently, 10% to 15% of iPhones are assembled in India.
Meanwhile, Vietnam has become a key manufacturing hub for consumer electronics. Evercore ISI data shows that around 20% of iPads and 90% of wearables (like the Apple Watch) are assembled in Vietnam.
Additionally, Malaysia—a major production base for Mac computers—faces a 24% tariff under Trump's new policy, while Thailand, another Mac production site, is hit with a 36% tariff.
Some Apple products are also assembled in the U.S., such as the Mac Pro in Texas, though components are sourced from countries like South Korea and Japan. Under the White House's new rules, South Korea faces a 25% reciprocal tariff, while Japan is subject to 24%.
In 2019, Trump visited Apple's Texas factory alongside CEO Tim Cook, touting the facility as a success of his policies. However, the plant later faced strikes and supply chain disruptions.
