Apple Says Trump's Tariffs Will Reduce Its Economic Contributions and Global Competitiveness

[0388631]

Not if they stop giving them selves $18M ( each, on average. Sometimes it’s WAY more ) bonuses every year and instead have that money re-invested into USA built lean manufacturing.

Apple will still be able to sell these devices at the same prices or if not even cheaper If they did this.

It costs them $200 to assemble an iPhone. That’s including labor, shipping, marketing, all of it... and then they turn around and sell it to you and me for $1500? That’s absurd.

Mind you, those executives hand these $1500 iPhones out their friends and family FOR FREE. Including iPads, MacBook’s iMac’s etc etc.

You and I have to pay up premium prices while those corporate executives gain millions in profits and walk away with the same products for free.

This has to stop. Hopefully these tariffs wake them and everyone else the Hell up.

It costs them $200 in parts they wholesale purchased. Apple doesn't manufacture individual components. They merely designed the OS and the SoC, the SoC isn't made by them either. To build everything American, Apple would either have to buy and transfer foreign companies provided major nations cleared the deal or build them out themselves. We're talking hundreds of billions, with recurring billions in costs each year.

And why should executives not be able to take $18M in TOTAL COMPENSATION each year? Why should they take say $1M and put the rest to their workers or invest in other things? That's almost socialist in nature.

 

[Chloros]

Apple who marks up 40% on their products. Who cares Tim.....the Apple loyalists (privileged) will cover the tariffs.

 

[Swift]

Invasion of the Mole People here, huh? Nationalism, my friends, is a destructive force in the world right now.

 

[2IS]

This whole tariff thing is one of the stupidest things Trump has done in office, other than obstructing justice to the point that he’ll immediately be indicted once he’s no longer in office.

Hopefully he stops monkeying around with the economy like this before driving us into a recession.

Looks like we have CNN employees lurking MacRumors

 

[hagar]

And the USA is skyrocketing under Trump!!!

How exactly is the USA skyrocketing under Trump? Economy and unemployment are doing great (thanks Obama) but otherwise I don’t see many improvements. Most jobs don’t pay enough, 80% of the people living from pay check to pay check, inequality rising, farmers in trouble, childcare and education too expensive, no shift to sustainable energy and resources, not addressing climate change, losing your voice on the world forum, ...

But I’m realistic. While he’s the most unpopular president to be re-elected, he will get a second term. Unless he single handed tanks the economy. If he manages to not do anything besides playing golf and sending out stupid tweets his base loves, he’s set for another 4 years.

And Cook: I don’t agree with the direction he took Apple in, but I saw positive signs during the last WWDC. Looks like they’re becoming a tech company again instead of a fashion company.

 

[Swift]

And it makes absolutely no sense for the United States.

 

[mabaker]

How exactly is the USA skyrocketing under Trump? Economy and unemployment are doing great (thanks Obama) but otherwise I don’t see many improvements. Most jobs don’t pay enough, 80% of the people living from pay check to pay check, inequality rising, farmers in trouble, childcare and education too expensive, no shift to sustainable energy and resources, not addressing climate change, losing your voice on the world forum, ...

But I’m realistic. While he’s the most unpopular president to be re-elected, he will get a second term. Unless he single handed tanks the economy. If he manages to not do anything besides playing golf and sending out stupid tweets his base loves, he’s set for another 4 years.

And Cook: I don’t agree with the direction he took Apple in, but I saw positive signs during the last WWDC. Looks like they’re becoming a tech company again instead of a fashion company.

Trump has a charisma of a potato and people still blindly believe him. Sad!

 

[Coconut Bean]

So to summarize: Because I want a cheap phone we should abandon trying to keep our home country safe and secure. We should embrace abusive labor practices of multi-national corporations or Apple won't be able to compete with companies that do. Wow... you really love cheap phones.

Gotta love how suddenly many are concerned with bad labour pratictices and that’s why Apple should manufacter stuff in America. Not because of the tariffs, not at all.

That said, many have pointed out that Apple can’t do it in America as the kind of labour needed does not exist here. And even if it was assembled in the US ala Mac Pro, 99% of the components would still come from Asia, likely also tariffed.

 

[Rocketman]

For those of you who have completely missed the point, tariffs are a TEMPORARY MEASURE (it only happened recently and was stated to nudge a change in behavior). They will be removed or reduced when China reduces their tariffs on us, stops dumping where tariffs are ineffective, and complies with their own SIGNED treaty obligations on trade matters.

Apple is likely to get limited exemptions unlike many other industries anyway. Where are the folks INSISTING on fairness that Apple be exposed to the exact same lack of exemptions as all other US companies?

 

[pshufd]

Apple is doing a nice job on its own as far as reducing its competitiveness. I do hope that they turn things around.

 

[brendu]

How exactly is the USA skyrocketing under Trump? Economy and unemployment are doing great (thanks Obama) but otherwise I don’t see many improvements. Most jobs don’t pay enough, 80% of the people living from pay check to pay check, inequality rising, farmers in trouble, childcare and education too expensive, no shift to sustainable energy and resources, not addressing climate change, losing your voice on the world forum....

Specifically what did Obama do that has had this effect on our economy? Specifics please.

 

[kipwheeler]

Apple has another option... They could decide to assemble or manufacture here in the U.S.A. Yes, I realize that their labor expense would go up, after all, we do not allow people to work for a few dollars a day, in horrible conditions, but they would have less in tariffs. Made in the U.S.A. used to mean something. I remember when I was proud that the Mac Pro was being assembled in Texas.

If the added cost of US labor costs end up being less than extended tariff price increases, they almost certainly will move at least some manufacturing--but so far Apple has initially indicated that other Southeast Asian countries (Korea, Vietnam, Singapore, Japan etc.) would be first in line for the move in manufacturing (so it will benefit those countries greatly, not so much the US).

If they do go with the US manufacturing route and don't with Korea or Vietnam or Japan, the additional price to the consumer over the counter is estimated to be roughly equivalent to the boost in price with tariff, so all Apple products with hardware would cost about 22-23% more than they do now (as opposed to 25% more with the tariffs).

At that point, one has to weigh the economic costs that come with that increased price. There are 1.3 billion Apple devices in the wild, and 67% of US households own at least 1 Apple product. The increase in US jobs would be estimated to be between 2,000-5,000 factory workers per factory, with may be 3-10 factories. Assuming those factory workers earn $45,000-$90K a year, you'd be looking at an injection of $1.3 billion to a $4 billion into the US economy overall. The increased prices from Apple (and reduced sales overall) would be 22% in manufacturing costs instead of 25% with tariffs, but even 22% of an $89 billion dollar industry comes to a maximum of $19 billion in potential lost sales and economic infusion into the US as a whole. The minimum could be a tenth or half of that ($1.9 billion or $9.5 billion) if it turns out 90% or 50% of customers are not phased by sticker shock on the apple products.

I don't know that there's any good way to determine how much of the profit goes to shareholders rather than being injected back into the US economy, but I can't figure out any math by which the US consumers or the US economy benefits as a whole--even if it's helpful to 1-2 towns with manufacturing. The only way it could avoid that is if the US factory workers were willing to work for $15,000 a year instead of $45-90K.

 

[Bug-Creator]

If the added cost of US labor costs end up being less than extended tariff price increases, they almost certainly will move at least some manufacturing.....

If tariffs are the only thing that forces Apple to build iPhones&Co in the US it seems like a given that only the units destined for the US market will be made there.

Some other countries will answer with counter-tariffs on unrelated products (has already happened) or try to strong arm Apple into producing "their" iPhones locally to.

-> Everybody pays more for an iPhone, Apple has lower profits, job gains will be more then negated by losses in other fields

Sounds like a plan,

 

[macpro2000]

How exactly is the USA skyrocketing under Trump? Economy and unemployment are doing great (thanks Obama) but otherwise I don’t see many improvements. Most jobs don’t pay enough, 80% of the people living from pay check to pay check, inequality rising, farmers in trouble, childcare and education too expensive, no shift to sustainable energy and resources, not addressing climate change, losing your voice on the world forum, ...

But I’m realistic. While he’s the most unpopular president to be re-elected, he will get a second term. Unless he single handed tanks the economy. If he manages to not do anything besides playing golf and sending out stupid tweets his base loves, he’s set for another 4 years.

And Cook: I don’t agree with the direction he took Apple in, but I saw positive signs during the last WWDC. Looks like they’re becoming a tech company again instead of a fashion company.

Obama for the economy= funny

Most jobs don't pay enough=work harder and that will fix itself

80% living paycheck to paycheck=but most have an iPhone (hmmm live within your means)

Inequality rising=democrats strive for this as it keeps them in power

Farmers in trouble=not true, they are notorious for understating their profits, believe me they are still doing quite well. Smart folks in farming and programs and subsidies more than fathomable.

Childcare too expensive=cost of having kids

Education too expensive=Agree with this one 100%...Which party owns this one?

No shift to sustainable energy and resources= We are pumping oil like no tomorrow in the U.S. right now and not dependent on Saudi Arabia anymore. Sweet.

Not addressing climate change=Everyone who's smart knows it's a hoax and a way to redistribute wealth in the world.

Losing your voice in the world forum=Actually our voice is actually being heard and we're saying we aren't going to pay for the worlds problems alone. Time for some common sense.

Thank you President Trump for actually doing the right things even when they aren't the status quo. It's amazing that 1/2 of the country isn't astute enough to see what's going on. I'm happy to see that Trump has brought up people like Candace Owens who brilliantly empowers blacks to see through the tactics of the left to keep black people in poverty and subsidized by the system. They deserve better.

Best president ever!

 

[2IS]

I feel like a lot of you have no idea what the idea behind tariffs are.

Apple has a few options

1) Absorb the added cost
2) Move manufacturing either domestically or another country without tariffs
3) Pass on the cost to consumers
4) A combination of the above options

Options 2 and 3 hurt China. 2 should be obvious why, so I'll just elaborate on 3

Lets take the precious iPhone since that is Apple's #1 product. All the folks repeating CNN talking points are thinking "bad for consumer" and not bothering to think outside the box. No one here NEEDS a new iPhone every year. If the costs go up, I would simply hang on to my phone for an extra year. Not a big deal at all, especially considering the highly incremental updates Apple makes every year. I'm willing to bet if iPhone costs go up, that's what a lot of consumers will do. If anything you're saving money, at least in this example.

What's the effect of that? Apple sells less iPhones, and thus, produces less iPhones. What's the effect of that? Chinese companies make less money and their fabs lay dormant, workers are out of jobs. This is EASILY more painful to China than it is for the Jones' to hang on to their phone for an extra year (the horror!)

 

[malofx]

The only good thing coming out of this circus at the end... We will find out who is going to hurt on the next iPhone release.

On another note, Apple won't observe the tariff, they are greedy and they have investors like you and me, that want to see our shares grow, not shrink, so yeah... not bueno, Donald is just being a mean hombre.

 

[stylinexpat]

I feel like a lot of you have no idea what the idea behind tariffs are.

Apple has a few options

1) Absorb the added cost
2) Move manufacturing either domestically or another country without tariffs
3) Pass on the cost to consumers
4) A combination of the above options

Options 2 and 3 hurt China. 2 should be obvious why, so I'll just elaborate on 3

Lets take the precious iPhone since that is Apple's #1 product. All the folks repeating CNN talking points are thinking "bad for consumer" and not bothering to think outside the box. No one here NEEDS a new iPhone every year. If the costs go up, I would simply hang on to my phone for an extra year. Not a big deal at all, especially considering the highly incremental updates Apple makes every year. I'm willing to bet if iPhone costs go up, that's what a lot of consumers will do. If anything you're saving money, at least in this example.

What's the effect of that? Apple sells less iPhones, and thus, produces less iPhones. What's the effect of that? Chinese companies make less money and their fabs lay dormant, workers are out of jobs. This is EASILY more painful to China than it is for the Jones' to hang on to their phone for an extra year (the horror!)

No need to really move and close down any local manufacturing plants abroad. What they will do is just add manufacturing plants and diversify their orders like car manufacturers do. The old saying of “Never leave all your eggs in one nest”

 

[omihek]

I'm not going to read through 10 pages of comments to see if this question has already been asked or answered, but...

Why would U.S. tariffs hurt Apple's global competitiveness? They don't actually have to import an iPhone into the USA to sell it in, say, India, no?

 

[stylinexpat]

I'm not going to read through 10 pages of comments to see if this question has already been asked or answered, but...

Why would U.S. tariffs hurt Apple's global competitiveness? They don't actually have to import an iPhone into the USA to sell it in, say, India, no?

One reason could be retail price for those that shop while abroad. In Asia this is quite popular where businessmen and tourists shop while abroad. Locals in the US may not see this point of view. I’ll give one example. Many Chinese go to Hong Kong or other countries to buy a Rolex watch because it is cheaper there. In the past people would come from China to Hong Kong and stand in line for hours to buy the new iPhone because it was cheaper in Hong Kong compared to China. Any item that can be bought and carried while traveling would be considered an item that would make the Global competitiveness list.

 

[hagar]

Most jobs don't pay enough=work harder and that will fix itself

You do realise that this position alone, enforces inequality and (illegal) immigration? You find it normal that there are jobs that pay less than what you need to live. And your solution is to work harder. Meaning you either work two, three similar jobs, which will still keep you poor, and unhappy. Or you move up the corporate ladder, which is not for everyone, and implies the lower jobs are for losers. And in an ideal world with only middle (or high) income households, no American should do them. So, you need a lot of immigrants doing those jobs for you. Is that what you want?

The same with Apple: the hypocrisy of people is incredible. Claiming tariffs are good because it’s not ok cheap Chinese labour is producing our phones. While wearing a Made-in-China-MAGA hat.

 

[Detnator]

Hold on, Tim Cook's obligation is to the stockholders. His job is to make them as much return on their investment as possible. He is not obligated to the Mac Community, the Apple Employee, or even the U.S.A.

Exactly. All these people on here blaming Tim Cook are ridiculous. Tim isn’t in charge of Apple. The board of directors are and even they’re accountable to the shareholders. Tim makes a move that isn’t in line with them and he’s out of his job and someone else steps in who is. Stop blaming Tim. Blame the people who are really in charge of Apple.

(Remember Apple in the 90’s? So we want to go back to that, and wind up with Microsoft or Google running the world instead?)

 

[stylinexpat]

I think Apple will miss next earnings. Should be good to short

https://www.cultofmac.com/633162/sluggish-iphones-sales-leave-apple-with-surplus-oled-problem/

 

[hagar]

Message deleted

 

[Swift]

Apple has another option... They could decide to assemble or manufacture here in the U.S.A. Yes, I realize that their labor expense would go up, after all, we do not allow people to work for a few dollars a day, in horrible conditions, but they would have less in tariffs. Made in the U.S.A. used to mean something. I remember when I was proud that the Mac Pro was being assembled in Texas.

It meant something when our internal market was the largest in the world. Now our manufacturers want to selll to a world market. That is the market as a whole. We need a world relatively free of tariffs to sell to the whole world. Remember cars? The cars we drove were made in "Detroit," that is, the industrial midwest. Europe had its own cars, etc. We consolidated the world market long ago. You want a Japanese or German car? Tough. We'll have big tariffs. Our cars won't have to compete with foreign cars. We won't be able to sell ours into foreign countries, because they'll charge a huge tariff on them to protect their own.

It's particularly dumb for digital products, which really took off after the American invention of the Internet. An iPhone, and all the rest, are international products that sell into the world market. The sole difference in the prices are the result of currency fluctuations. The iPhone sells everywhere. The standards used, for the communications chips, the languages supported, are world standards. The parts of the iPhone come from all over the world. They are assembled in China, because of the abundance of labor available, and because it's abundant, it's cheap. Yes, Apple did assemble the old Mac Pro in the US, but that's not a good example. They sold very few, because it sucked. They might very well assemble the new Mac Pros here, I don't know, but if they sell 100,000 of those they're doing great. But again, where does the San Diego firm, Qualcomm, make its chips? Asia. Apple designs its sac's, but TSMC makes them in Taiwan. Corning makes the gorilla glass in the US. Once WE put tariffs on the makers of our ARM chips, everybody's going to go back to their own, national markets. That is regression. Everybody will go behind tariff walls.

Know what that leads too? World wars.

We are nostalgic for the old days of the Hamiltonian tariffs that helped us develop from a small, developing nation to the greatest power in the world. At the end of World War II, we knew a thing or two, and began working for a world free of tariffs. Going backwards makes no sense, and if we continue in this direction, it will be the end of us.

 

[ROGmaster]

Samsung assembles their phones in Vietnam, China, India, Brazil, Indonesia, and Korea. The two Vietnam plants and the China plant are the majority of their assembly.

https://www.scmp.com/economy/china-...last-china-smartphone-factory-closing-raising