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The cost of iPhones might increase threefold. Donald Trump Analysts commented today on the fresh tariffs imposed. Apple fans consider boycotting the firm which has seen its stock plummet.
The cost of a 256GB iPhone 16 Pro could soar from $1,100 (£850) to as much as $3,500 (£2,715), experts warned after the President's 'Liberation Day' crackdown.
Most iPhones are still made in China , which incurs a 54 percent tariff on U.S. exports – and Apple will now be assessing how much of the additional cost it can handle internally.
However, technology enthusiasts are furious about the potential price increase, with several stating it’s high time to bid farewell to iPhones and welcome Samsung 'One mentioned it was Trump's clever move to promote.' Android Some suggested getting phones, while others recommended: "Simply purchase a Samsung; issue resolved."
This arrives as the UK's FTSE 100 dropped to a one-year low earlier today, even after Sir Keir Starmer proposing fresh initiatives to aid struggling manufacturers.
Experts have cautioned that the level of disturbance in worldwide financial markets ranks among the most severe experienced in many years. This morning, the FTSE index fell approximately 5 percent during early trades in London as a significant selloff began immediately following market openings.
The anxious atmosphere spread throughout Europe, with Germany The DAX index experienced a decline of approximately 6.5 percent, and France The CAC 40 fell by approximately 5.3 percent during early trading. Meanwhile, overnight, stock markets throughout Asia were also declining, hitting fresh low points.
Currently, the production cost for the iPhone is expected to rise from $580 (£450) to $850 (£660), according to TechInsights analyst Wayne Lam. The Wall Street Journal .
As many of these expenses are anticipated to be transferred to consumers, particularly in America, several Apple customers may now decide to part ways with the U.S. technology leader.
Apple sells over 220 million iPhones annually, with major markets including the U.S., China, and Europe. Nonetheless, the company’s stock price fell by 9.3 percent last Thursday, erasing $311 billion from its market capitalization, marking its most significant single-day drop since March 2020.
The most affordable iPhone 16 was introduced in the U.S. priced at $799 (£619). However, according to estimates from Rosenblatt Securities' analysts, it might go up to $1,142 (£885) – indicating an increase of approximately 43%. This hike would depend on whether Apple manages to implement these higher costs onto customers.
An upgraded version of the iPhone 16 Pro Max, featuring a 6.9-inch screen and one terabyte of storage space, is presently priced at $1,599 (£1,239). However, should this price rise by approximately 43 percent, it would soar to around $2,300 (£1,782).
This could also have an impact on prices in the UK, if Apple decides to increase the price by the same amount in Britain – or it could increase both UK and US prices by a smaller amount.
But Angelo Zino, equity analyst at CFRA Research, said the company will have a tough time passing on more than 5 to 10 per cent of the cost to consumers.
He added: 'We expect Apple to hold off on any major increases on phones until this fall when its iPhone 17 is set to launch, as it is typically how it handles planned price hikes.'
Any price rises for Apple could also give South Korea's Samsung an edge, as the country faces lower tariffs than China, where all iPhones sold in the US are made.
At present, the assembly cost stands at approximately $30 in China; however, relocating production to the US would cause these costs to increase roughly tenfold, as Mr. Lam pointed out.
Apple did not respond to the Wall Street Journal’s inquiry regarding possible price adjustments due to the recently introduced tariffs.
Nevertheless, should the forecasts from market experts hold true, the implementation of tariffs would probably lead to a rise in the price of an iPhone.
On social media, technology enthusiasts seemed prepared for the worse as a commenter noted: 'Apple users are going to experience what true inflation really feels like.'
Another quipped: "Trump contributing to making the iPhone 16e seem like a great bargain lol."
Alarming for Apple, numerous previous customers have declared their intention not to pay the higher cost and are urging others to follow suit.
On X, a commenter proposed: 'Cease purchasing iPhones?'
'Another person advised, "Stop purchasing these costly smartphones."'
A commentator added: "Skip this purchase. There’s no necessity for it. It's sheer luxury."
One person lamented that the iPhone “never seemed worthwhile from the start.”
Likewise, a technology enthusiast commented: "I'm not sure why individuals shell out so much money for an iPhone. An Android phone would be a better choice."
Even those who might be thinking about buying an iPhone suggested that they would either avoid making the purchase or delay upgrading to the newer model.
A potential Apple customer wrote: 'I was just about to get one too. I'll have to wait a little bit and see how it all plays out.'
'No one needs to buy an iPhone every year,' added another.
Mr Trump claims his tariffs will encourage domestic manufacturing by increasing the price of foreign products.
However, because Apple would still require importing the raw materials needed for manufacturing its devices, experts indicate that there isn’t a cost-effective method to produce iPhones within the U.S.
Mr. Crockett informed the Wall Street Journal that shifting iPhone manufacturing to America would be an enormous and monumental task.
'There’s uncertainty about whether a competitively priced smartphone can be produced locally,' he explained to the publication.
During his initial tenure as president, Mr. Trump levied duties on numerous Chinese goods with the aim of compelling American firms to relocate their production facilities either back to the U.S. or closer to home in places like Mexico. However, Apple managed to obtain exemptions or waivers for various items. In this current situation, though, he hasn’t approved any such exceptions for them.
'Barton Crockett, an analyst at Rosenblatt Securities, stated in a report, "The current situation with the China tariffs is unfolding entirely opposite to what we anticipated—namely that American brand Apple would receive special treatment similar to what occurred previously,"'
The iPhone 16e, launched in February as a cheaper entry point for Apple's suite of artificial-intelligence features, costs $599. A 43 per cent price hike could push that cost to $856. Prices of other Apple devices could jump as well.
Many customers pay for their phones over a period of two or three years through contracts with their cellular providers.
However, other analysts noted that iPhone sales have been floundering in the company's major markets, as Apple Intelligence, a suite of features that helps summarize notifications, rewrite emails and give users access to ChatGPT, has failed to enthuse buyers.
Expert reviews have suggested that the features, while innovative, do not provide enough of a compelling reason to justify upgrading to newer models.
A slowdown in demand might add extra strain to Apple's profits, particularly if expenses increase because of tariffs.
Despite some manufacturing shifting to Vietnam and India, the majority of iPhones continue to be produced in China. Both these nations faced tariffs as well, with Vietnam facing a 46 percent duty and India bearing a tariff rate of 26 percent.
To compensate for the import tariffs, Apple might have to increase its prices by approximately 30 percent on average, as stated by Neil Shah, co-founder of Counterpoint Research.
'Rosenblatt Securities' Crockett pointed out our rapid calculation regarding Trump's tariff Independence Day indicates this might severely impact Apple, possibly resulting in losses of up to $40 billion for the company,' he added, noting that talks among Apple, China, and the White House are expected.'
'It's hard for us to imagine Trump blowing up an American icon...but this looks pretty tough.'
Silicon Valley chief executives turned to Trump in the run up to his election victory, buoyed by his promises to cut regulation and taxes.
Jeff Bezos, chairman of Amazon, Mark Zuckerburg, Meta chief executive, Tim Cook, Apple boss, and Sundar Pichai of Alphabet all attended Trump's inauguration in January, publicly backing the President.
Meta and Amazon both gave $1million to Trump's inauguration, while Apple's Tim Cook personally donated another million.
However, the affection has faded away following Trump’s announcement of extensive tariffs last week, causing billions to be erased from the market value of technology leaders' shares.
Russ Shaw of Tech London Lawyers commented, "Initially, their relationship seemed like an unusual friendship. In my view, it was driven by mutual opportunism."
Biden never contacted the big technology companies, so Trump seized the opportunity. Now, a stark truth has become evident.
Especially hard-hit by the aftermath was Apple.
Trump imposed crushing tariffs not only on China, where the majority of Apple's iPhones are made, but also on countries such as Vietnam and India, where Cook has quietly moved parts of its production in recent years in anticipation of further Chinese tensions.
In Vietnam, where Apple currently produces AirPods, iPads, and Apple Watches, the country suffered one of the biggest impacts, with a new tariff rate of 46 percent imposed on them. Meanwhile, India faces a tariff rate of 26 percent.
Trump's tariffs could lead to the price of an iPhone rising by up to 43 per cent, meaning the most expensive iPhone would cost $2300, up from $1599 today.
Mr Shaw commented, "This issue is notably severe for companies producing hardware such as Apple. They depend significantly on global supply chains to manufacture devices like smartphones and PCs."
Last week, Treasury Secretary Scott Bessent stated that a downturn in the markets indicated investors were adjusting from months of excessive enthusiasm about artificial intelligence and inflated technology stock prices. He referred to this as a 'Mag 7 issue, not a MAGA concern,' alluding to the 'Magnificent Seven' tech companies: Apple, Amazon, Tesla, Alphabet, Microsoft, Meta, and semiconductor manufacturer Nvidia.
On 'Liberation Day', Mr Trump declared that foreign trade and economic practices have sparked a national emergency.
All nations will be faced with at least 10 per cent tariffs on all US imports starting on Saturday.
However, over 90 nations will face extra retaliatory tariffs aimed at rejuvenating America’s wealth by April 9.
According to the White House, reciprocal tariffs represent the rates needed to offset the bilateral trade imbalances between the U.S. and every one of its trading partners.
Various nations such as China will face tailored taxes, with these levies determined by the White House taking into account each country’s trade practices.
In reaction to Mr. Trump’s Independence Day statement, Chinese President Xi Jinping announced that China would impose an extra 34 percent tariff on all goods coming from the U.S.
The fresh tariff, set to start on April 10, mirrors the 'reciprocal' 34 percent charge introduced by Trump. These additional charges will be on top of the current duties applied to American products.
"China’s new tariffs do not escalate into an all-out trade war, yet they represent a significant intensification — responding measure for measure with Trump and indicating that President Xi Jinping will not remain passive when faced with pressure," said Craig Singleton, a senior China fellow at the Foundation for Defense of Democracies, according to the Associated Press.
Before Wednesday’s announcement, Mr Trump had previously imposed two sets of 10 percent import tariffs on China.
'The longer this drags, the harder it becomes for either side to deescalate without losing face,' Mr Singleton warned.
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