Trump's Planned Tariffs on Imported Steel and Aluminum Would Likely Apply to Apple Products

[MacRumors]

U.S. President Donald Trump on Thursday said he plans to impose tariffs of 25 percent on imported steel and 10 percent on imported aluminum to protect domestic producers. Trump is expected to sign the formal order next week, and he promised that it will remain in effect for a "long period of time."

The controversial plan would almost certainly apply to Apple products like iPhones, iPads, and Macs, which contain a significant amount of the metals. The latest 15-inch MacBook Pro contains 740 grams of aluminum, for example, while the iPhone X contains 58 grams of stainless steel for its frame.

The details of Trump's plan aren't fully clear yet, however, according to Bloomberg News. If the tariffs only apply to raw materials, for instance, then Apple would be largely unaffected since the majority of its devices are assembled in Asia and shipped to the United States as finished products.

If the duties do apply to finished products, analyst Gene Munster speculated Apple's costs to make Macs and iPhones could rise as much as 0.2 percent, assuming the tax is a percentage of the steel and aluminum used in the devices.

Apple's domestic manufacturing is limited to the Mac Pro, assembled in Austin, Texas. The high-end computer contains 3,660 grams of aluminum and steel imported from outside of the United States, making it subject to the proposed tariffs. However, the Mac Pro is only produced in limited quantities.

The biggest question is whether the impact on Apple's profit margins would lead the company to raise the prices of Macs and iPhones, but given the company's costs are only estimated see a marginal increase, it would seem unlikely.

Note: Due to the political nature of the discussion regarding this topic, the discussion thread is located in our Politics, Religion, Social Issues 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: Trump's Planned Tariffs on Imported Steel and Aluminum Would Likely Apply to Apple Products

 

[William Gates]

It's not going to happen. Trump will back down off of this.

 

[samcraig]

It's going to affect pretty much any/every US company that uses Steel.

 

[Avieshek]

When would Macs & iPads upgrade to 7000-series aluminium as in iPhone 6s?

 

[Craiger]

Surely he's going to back away from this. Nobody is on his side except the basiest of his base.

 

[Chupa Chupa]

The biggest question is whether the impact on Apple's profit margins would lead the company to raise the prices of Macs and iPhones, but given the company's costs are only estimated see a marginal increase, it would seem unlikely.

I'm not a fan of tariffs, this one included. Like others I think (hope) it's just a hardball negotiation ploy. That said, it's not a big question. There isn't enough aluminum or steel in an Apple Watch to increase the raw cost more than a couple bucks. Given Apple's already juicy profit margin here and also competition, no, they are not going to raise prices $5 to offset the increased cost should that happen and Apple chose not to source U.S. materials.

The effect of the tariff will be borne more on companies than consumers. The Fed's 3 or 4 rate hikes will hurt consumers more than this by far.

 

[themick4u]

I do not see this affecting Apple (or any other component builder) for that matter. I project this will primarily affect raw materials mostly.

 

[Blackstick]

Find a new way to hate the POTUS every day.

 

[Phonzoxd]

This is why apple is switching to glass. They saw the future.

 

[manhattanboy]

I do not see this affecting Apple (or any other component builder) for that matter. I project this will primarily affect raw materials mostly.

Perhaps they will bring back the plastic iBook.

 

[Falhófnir]

Surely it would only apply to the Mac Pro being made in Texas? I doubt they would tax a finished products for the materials it contains...

 

[napabar]

For some, I guess it's OK if other countries like China tax the hell out of our steel, yet expect us to import theirs duty free. This kind of one-sided nonsense has to end. The US should match the tariff rate off each country that we do business with. That's the best way to encourage free trade. They get the same deal they give us.

And shame on Apple for using imported steel for the Mac Pro, when they could buy locally. That's going to end,

 

[BoxerGT2.5]

Republicans: Man, Trumps popularity numbers suck, but as long as the economy keeps growing this way he has a shot.

Trump: "Hold my beer, I'm starting a trade war."

 

[Luap]

It's not going to happen. Trump will back down off of this.

Why would he?

 

[Madmic23]

The details of Trump's plan aren't fully clear yet,

Are the details of any Trump plan ever clear?

 

[Guda.FL]

Not to get into a political push, not too far from that industry...there is of course good and bad in this. However, aside of his trade wars or what ever this will mean. There is truth in the overwhelming negative trade and tariffs that are imposed on our corp for example. Without using names; we import specific products that are pretty much a win for a partner...however when we try or have tried to reverse or sell back complete products back to them we are hit with 2-5x the mount of protective taxes of that nation. We always talk about it, it is an on going issues. How its to be dealt with who knows, and probably this isn't the answer, but a more fair trade does need to be addressed.

Thats as far as I can go in personal experience, however...someone else probably gets a decent perk that we dont know about that was the trade off. Who knows...

 

[mozumder]

Congratulations Trumpers, you played yourself.

Sorry kids, but if you can't compete with other countries fairly, you don't deserve to stay in business. There's no faking it in economics. If you try to fake it by protecting bad unprofitable industries, you end up like Venezuela.

The goal of economics should always be efficiency. If that means letting a Chinese person do something because they can do the same thing for cheaper, LET THEM. Americans will find something else to do that takes advantage of their skills.

If you think a person in China is your competition, then you have already lost.

 

[seatton]

So Apple Watch stainless steel will be as costly as the Edition soon???

 

[shareef777]

I can’t stand trump, but I still like this proposal. Businesses (including Apple) price their products on what the consumer is willing to bare. Any added costs to these businesses won’t make them change their prices. This tariff wasn’t around when Apple decided to price a $1k phone.

 

[BornAgainMac]

Well, I want a titanium Macbook Pro

 

[npmacuser5]

Trump badly needs to raise taxes to offset his tax cuts and spending. Here is the answer, Tariffs. Terriffs are taxes with a different label. Trump said exactly the same. We the people or the manufacturer pay this tax on the Tarriff applied goods. Cleaver!

 

[JRobinsonJr]

It's not going to happen. Trump will back down off of this.

I don't know if this really is good... or bad... but I would be hugely surprised if Trump backs down. His overarching MAGA directive has so far proven effective.

 

[0388631]

A black polycarbonate MBP sounds amazing...

 

[OldSchoolMacGuy]

"Will likely"? It will apply to everyone using those products. The price of beer will be increasing because of it.

 

[BoxerGT2.5]

College kids better start stocking up on beer.