Apple Inc, which has lost one-fifth of its value in a tech market rout since last month, is poised for another setback after US President Donald Trump suggested that 10 percent tariffs could be placed on mobile phones and laptops made in China.
The company is already facing reports of suppliers cutting forecasts, signaling that the new iPhone models introduced in September are not selling as well as anticipated.
Trump’s comments to the Wall Street Journal that he might include Apple’s signature product in another round of tariffs on Chinese imports are another blow.
“Maybe. Maybe. Depends on what the rate is,” he said, referring to mobile phones and laptops. “I mean, I can make it 10 percent and people could stand that very easily.”
Apple stock fell about 1.6 percent in extended trading on Monday following the comments.
The US is due to raise import duties on about US$200 billion worth of goods from China to 25 percent from 10 percent on Jan. 1. The vast majority of iPhones and other Apple products are built in China and then exported globally.
Apple could not be reached for comment.
So far, Apple’s most lucrative devices, such as the iPhone and iPad, have been left out of US tariffs.
Earlier this year, Apple said products such as the Apple Watch and AirPods would be affected before the US said it would not impose taxes on such items.
Still, the company in September said that other items, such as the Mac mini, Apple Pencil stylus, and some cables and cases, could be harmed.
The company has made a small percentage of older iPhone models in Brazil and India in recent years, in part to avoid local taxes on imported goods.
Trump on several occasions has suggested that Apple should bring iPhone manufacturing to the US.
In his early years running Apple, chief executive officer Tim Cook responded to questions about increasing manufacturing in the US by saying the skill sets in China are more conducive to producing the company’s products.
However, Cook has in recent months modified that view, saying in an interview this year that “it’s not true that the iPhone is not made in the United States.”
Some components, such as the smartphone’s glass cover, are manufactured in the US and shipped for assembly in China.
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