Apple Avoids iPhone Tariffs as U.S. and China Reach Trade Deal

[MacRumors]

Apple won't be hit with hefty tariffs on the iPhone, iPad, and MacBooks as U.S. President Donald Trump this afternoon signed off on a trade deal with China.

Speaking in a note to investors shared by Bloomberg, Wedbush Securities analyst Dan Ives said that the new tariffs could have added approximately $150 to the price of iPhones during the holiday season.

"Trump delivered an early Christmas present to Apple. If this tariff went through it would have been a major gut punch for semi players/Apple and could have thrown a major wrench into the supply chain and demand for the holiday season."

If Apple absorbed the cost of the tariffs, the company's earnings per share would have shrunk by approximately four percent, according to Ives. Raising prices could have caused iPhone demand to shrink by an estimated six to eight percent in 2020.

Apple is paying tariffs on the Apple Watch, AirPods, iMac components, and HomePod speaker, which could potentially be eliminated now that a deal has been reached. Apple in November also applied for tariff waivers on these items.

The tariffs that were avoided today were originally set to be put in place in August, but were delayed until December 15 to give the U.S. and China more time to reach an agreement.

Apple CEO Tim Cook has been speaking with Trump about the tariffs, and in August reportedly made a "good case" arguing that tariffs would put Apple at a disadvantage with rivals like Samsung. Apple earlier this year also sent a letter urging the Trump administration not to proceed with the tariffs.

Cook in late October said that he was confident the United States and China would resolve the trade dispute. "I don't know every chapter of the book, but I think that will eventually happen," said Cook.

Note: Due to the political nature of the discussion regarding this topic, the discussion thread is located in our Political News forum. All forum members and site visitors are welcome to read and follow the thread, but posting is limited to forum members with at least 100 posts.

Article Link: Apple Avoids iPhone Tariffs as U.S. and China Reach Trade Deal

 

[Sasparilla]

Good for Apple. It'll be interesting to see if the Chinese actually reach a final deal with the Trump administration (that isn't a giveup by the admin...since the election is coming and they'll want a completion).

No matter what though, Apple needs to start extricating its supply and build chain out of China...staying there does not seem politically sustainable, mid to long term. One small issue with Taiwan (which seems inevitable) and it'll be worse than what were going through now.

 

[SDJim]

So that's why the shares jumped in spite of the report of slow sales in China...

 

[NickName99]

Trump got us into this tariff mess, I’m curious to see if we ultimately end up in a better or worse position for it.

I feel especially bad for all the US farmers who have lost relationships with Chinese buyers over the tariffs.

 

[smithrh]

Market manipulation at the highest levels...

 

[BigBoy2018]

Thank god for Trump. He’s a total dick who has no respect for anything (except for his own self interests) but occasionally does a couple things that are vaguely worthwhile. WHAT AN AMAZING PRESIDENT! ?

 

[Rojaaemon]

Make Apple Stock Price Great Again!

 

[Mr. Dee]

But Apple will use a what if scenario and raise the prices of next years iPhone just to justify squeezing more profits. Either way, doesn’t matter, will still be using my iPhone X.

 

[Brandhouse]

Trump got us into this tariff mess, I’m curious to see if we ultimately end up in a better or worse position for it.

I feel especially bad for all the US farmers who have lost relationships with Chinese buyers over the tariffs.

Exactly, but it isn't localised to the US, it's become a world wide problem for the world economy. For those that think that Idiot Leader Trump is helping MAGA, think again. All he's doing is playing his schoolboy antics, but being blinkered to the affect on the world stage.

 

[SSDGUY]

Thank god for Trump. He’s a total dick who has no respect for anything (except for his own self interests) but occasionally does a couple things that are vaguely worthwhile. WHAT AN AMAZING PRESIDENT! ?

If he can talk Tim into putting the 3.5mm audio jack back in my iPhone he's got my vote.

 

[mannyvel]

China has been reaping the benefits of open markets without opening its markets up as much. That's been the goal of this trade round. Previous politicians were afraid of upsetting China due to an unrealistic view of China's actual power.

Trump probably burned 1-2%/year of GDP growth for this deal, but it should be worth it in the long run. Good timing, since you want to start a trade war when you're doing well. Nobody notices growth that doesn't happen.

Trump may be a dick, but he's our dick.

 

[JPSaltzman]

I guess Sleeping with the Enemy paid off for Tim.

 

[A MacBook lover]

I love this president.

He’s basically renegotiated trade deals with China, Canada, Mexico, Japan, EU, and UK. No wonder the economy is soaring.

All the people saying that Tariffs were wrong, and yet China finally caved. Lmao.

Best part as it has had zero effect of the consumer

 

[jarman92]

Does MacRumors know something nobody else does? There is no "trade deal"...the US and China agreed on an outline to a potential deal that resolves some trade disputes. This has also happened like 6 times before, and it was just Trump bloviating as usual.
[automerge]1576202032[/automerge]

I love this president.

He’s basically renegotiated trade deals with China, Canada, Mexico, Japan, EU, and UK. No wonder the economy is soaring.

All the people saying that Tariffs were wrong, and yet China finally caved. Lmao.

Best part as it has had zero effect of the consumer

Did you actually educate yourself on this story, or do you just respond to everything by verbally fellating Trump? Nobody said anything about China caving...for all we know, Trump caved. There aren't many details about the terms of the potential deal.

 

[-BigMac-]

Apple will still think of a reason to “raise 2020 iPhone prices” for some reason..?

 

[tridley68]

Thank you Mr President Donald Trump ??????

 

[4487549]

Munchausen syndrome by proxy (he solved the problem that he alone created).

 

[Justanotherfanboy]

Does MacRumors know something nobody else does? There is no "trade deal"...the US and China agreed on an outline to a potential deal that resolves some trade disputes. This has also happened like 6 times before, and it was just Trump bloviating as usual.
[automerge]1576202032[/automerge]


Did you actually educate yourself on this story, or do you just respond to everything by verbally fellating Trump? Nobody said anything about China caving...for all we know, Trump caved. There aren't many details about the terms of the potential deal.

Well put, sir.
With regards to @Amacfa making the ludicrous chest-thumping Trump drunk statement that China “caved”...

https://www.washingtonpost.com/opin...a-b4c1-fd0d91b60d9e_story.html?outputType=amp

Someone over at The Post sure seems to have a differing opinion! ;0)

TLDR;
FROM LINKED ARTICLE:
“On Thursday, the Wall Street Journal reported the Trump team caved on that huge point...”

Poster had story exactly backwards!

 

[szw-mapple fan]

I love this president.

He’s basically renegotiated trade deals with China, Canada, Mexico, Japan, EU, and UK. No wonder the economy is soaring.

All the people saying that Tariffs were wrong, and yet China finally caved. Lmao.

Best part as it has had zero effect of the consumer

You do realize this is essentially a purchase and sale agreement that does nothing to achieve Trump's initial goals of IP protection and shrinking the trade deficit? It basically undid a little of the damage that the trade war had done to American farmers.

 

[A MacBook lover]

Well put, sir.
With regards to @Amacfa making the ludicrous chest-thumping Trump drunk statement that China “caved”...

https://www.washingtonpost.com/opin...a-b4c1-fd0d91b60d9e_story.html?outputType=amp

Someone over at The Post sure seems to have a differing opinion! ;0)

TLDR;
FROM LINKED ARTICLE:
“On Thursday, the Wall Street Journal reported the Trump team caved on that huge point...”

Poster had story exactly backwards!

As if you expect the Amazon owned Washington post to be impartial. post has put out dozens of false stories before.

Trump is a master deal maker. He’s produced results for this economy and keeps his promises. More jobs, record stocks, record unemployment, renegotiated trade deals. Even Pelosi called trumps USMCA unquestionably better than NAFTA. You can’t beat him, honestly.

Even Tim is smart enough to see past the anti-trump hate. I’m sure he’s tired of China trying to steal intellectual property - which is a huge part of the trade deal with China.

 

[Cosmosent]

 

[Sasparilla]

Apple will still think of a reason to “raise 2020 iPhone prices” for some reason..?

Yeah like how the price of the iPhone 11 went down $50 from last year's Xr (which was another $50 decrease from the prior years 8 Plus - its closest size prior LCD phone). And then look at how well the iPhones hold their value compared to the android phones. It's amazing isn't it?

 

[junkw]

can you explain the image ^^

 

[xb2003]

Coming from someone who buys the cheaper/est new iPhone every 2-3 years, I’d happily pay 50% more if timPhones were manufactured in the USA.

 

[Strelok]

As if you expect the Amazon owned Washington post to be impartial. post has put out dozens of false stories before.

Trump is a master deal maker. He’s produced results for this economy and keeps his promises. More jobs, record stocks, record unemployment, renegotiated trade deals. Even Pelosi called trumps USMCA unquestionably better than NAFTA. You can’t beat him, honestly.

Even Tim is smart enough to see past the anti-trump hate. I’m sure he’s tired of China trying to steal intellectual property - which is a huge part of the trade deal with China.

No point arguing with them to be honest, they won’t change their opinions no matter what Trump does. I find it funny they are trying to blame trump for the slowing global economy, because that only started happening when Trump got into office. Meanwhile the US economy is doing just fine.