- Apple has largely escaped the dramatic tariffs imposed by the U.S. on China and vice versa — which is saving American consumers thousands of dollars and American stockholders trillions.
- This is due in part to Apple’s immense value to both nations. It’s also due in part to some clever maneuvering by Apple officials.
- Meanwhile, the trade war between China and the U.S. continues to escalate.
Earlier this April, U.S. Customs and Border Protection noted that iPhones and other major electronics will be given a reprieve from the massive tariffs recently levied by the U.S. on China.
President Donald Trump posted to Truth Social a few days later that any producer would be let “off the hook”; in that vein, the iPhone has escaped the dramatically high tariffs on other products, some that could tower as high as 125%, with a much smaller (though still impactful) 20% tariff.
Apple, the world’s most valuable company, generates trillions of dollars in value for its American stockholders. Apple has also invested enormous amounts of money into technology improvement, education and infrastructure in China. The company also employs millions of Chinese workers.
For the most part, Apple has escaped the burden of the escalating trade war between the United States and China. In order to do so, the tech giant has been creative.
State of the Chinese-American trade war
Tension between the world’s two largest economies continues to ratchet up. The United States has implemented 145% tariffs on Chinese imports. In return, China has levied a 125% tax on American products.
The tariff storm has now begun casting its pall over the global economy. On Monday, April 21, The New York Times reported Beijing’s warning to countries who make deals with the United States against Chinese interests.
“Appeasement cannot bring peace, and compromise cannot earn one respect,” a government spokesperson told Chinese state media. “China firmly opposes any party reaching a deal at the expense of China’s interests. If this happens, China will never accept it and will resolutely take countermeasures.”
The United States has also said it will pressure foreign governments on China. The Wall Street Journal reported that the United States has promised tariff exemptions for countries that restrict their trade with China.
The Trump White House says more than 75 countries have initiated negotiations with the United States as a result of the tariff announcements.
He has also enacted a 90-day pause on reciprocal tariff implementation for all American trading partners, save China, following political blowback.
Airlifting iPhones and making friends with the president: What’s next for Apple?
Morgan Stanley’s recent survey about iPhones found that the 3,300 respondents expressed all-time-high intentions to upgrade their iPhones and adopt Apple Intelligence, Apple’s newly-unveiled artificial intelligence system.
Nevertheless, Apple’s stock price has dropped since Trump announced his tariffs. The tech giant has taken several steps in an effort to dodge rising taxes on its Chinese-manufactured products.
But its most recent step wasn’t a step so much as it was a flight. Reuters reported that, on April 10, Apple chartered cargo planes ferrying 600 tons of iPhones to the United States from India. Reuters analysts calculated the planes were carrying 1.5 million iPhones.
The massive airlift follows Apple’s major production investment into India in an effort to navigate around Trump’s tariff policies. India so far only faces a maximum tariff of 26% — the implementation of which is currently on hold as part of the 90-day pause.
This is not the only effort Apple has undertaken to dodge the consequences of tariffs. The Washington Post reports that Apple CEO Tim Cook exchanged private phone calls with U.S. Commerce Secretary Howard Lutnick and other senior White House officials about the impact the tariffs might have on iPhones.
The Post noted that Cook seemed to purposefully avoid criticizing the president on national television, unlike many other business executives in recent weeks.
Cook also personally attended Trump’s presidential inauguration and donated $1 million to the celebration, according to Axios.
“Tim has a very good relationship with the president and rightly so. He has been playing a very careful role in that he obviously has a huge dependency on China but is also hugely important to the U.S.,” said Wilbur Ross, who served as commerce secretary during Trump’s first term.
Just as Apple’s efforts will save it production costs, it will also help retain customers. Economists project that the $1,599 cost of the iPhone 16 Pro Max, the latest high-end iPhone, could have rocketed as high as $2,300 under the previous tariff burden on China.