Trump threatens 25 percent tariff on iPhones manufactured overseas

President Donald Trump has escalated pressure on Apple to manufacture iPhones for the American market domestically. In a post on Truth Social Friday morning, the president explicitly warned that he would recommend a 25 percent tariff be applied to any iPhones sold in the United States that were manufactured outside the country.

"I have long ago informed Tim Cook of Apple that I expect their iPhone’s that will be sold in the United States of America will be manufactured and built in the United States, not India, or anyplace else. If that is not the case, a Tariff of at least 25% must be paid by Apple to the U.S.,” the president wrote.

His reference to India was in response to continued reporting that Apple has been considering shifting all US-bound iPhone production to India in order to avoid trade instability with China brought on by tariffs.

Apple trialed low-volume production of iPhones in India in 2017 with the iPhone SE. The company began ramping up production in India throughout subsequent years, and now plans to accelerate that expansion. CEO Tim Cook clarified during the company’s most recent earnings call that the majority of iPhones sold in the US during the coming quarter would be sourced from India.

Apple has been careful in managing its relationship with the Trump administration, pledging investments in the United States that align with the president’s goals, and inviting Trump to "open" a manufacturing facility in Texas that had actually been producing Mac Pros for years. Apple CEO Tim Cook also donated $1 million to the president’s inauguration fund and attended the event. 

Analysts have said that an iPhone made in America could cost upwards of 25 percent more from increased labor costs alone. Labeling a product as "Made in the USA" requires meeting standards set by the FTC, and it's uncertain whether Apple could meet that standard without drastically increasing the cost of its products.

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