Chinese Goods Tariff Will Impact Most of Apple’s Products

The Trump administration has announced that its tariffs on $300 billion worth of Chinese imported goods will go into motion on September 1st. This announcement prompted a large number of U.S companies that deal in everything from footwear to toys and technology to warn that their prices might see a sudden spike. 

U.S President announced this tariff increase from 10% to 15% on Friday, via Twitter, after, during the ever-escalating trade war with China, Beijing stamped its own tariffs on $75 billion worth of U.S goods. 

The U.S Trade Representative office gave out a notice that the 15% tariff will be set into effect at 12:01 a.m. EDT (0401 GMT) on Sunday. This effort will be focused on over $125 billion goods from China which include smartwatches, Bluetooth headphones, flat panel TVs and footwear. The rest of the goods on the $300 billion list will follow on December 15th and will be applied to cellphones, laptops, toys and clothing. 

Among these companies, Apple will have to deal with 30% tariffs as of September 1st on products like Desktop Macs, the Apple watch, Airpods and the wireless Beats headphones as well as the HomePod. 

The additional 15% tariff will hit it again on December 15th and will apply to iPhones, iPads, MacBook Air and Pro, the iPod Touch, Apple TV, Keyboards, wired headphones and the Apple Pro Displays XDR.

Apple has tight ties with China: factories owned by Hon Hai Precision Industry Co Ltd’s Foxconn, Pegatron Corp, Wistron Corp and many others all host hundred of workers who assemble Apple devices all across the country. While the company has other factories in countries like India, Apple largely uses them for domestic demands. 

For everything else, it depends on the factories inside China, which, in the past few years have expanded from 19 locations to 29, in the case of Foxconn, while Pegatron went from 8 to 12. 

Beyond these factories, Apple also relies on China for chips, glass, aluminum casings, cables and more. Out of all of its supplier locations, 47.6% of them are located in the country. 

These tariffs will arrive smack in the middle of the holiday season and over 160 business groups such as the National Retail Federation, Retail Industry Leaders Association and Association of Equipment Manufacturers asked Trump to postpone them. However, their request has been so far, ignored.