Tariffs increase
US President Donald Trump has increased tariff upto 145% on chinese goods imported from there. China in return increased tariff with 125% on US products."Tit for Tat".
Trump's idea of boosting production
Trump also increased 10% tax on goods from majority of other countries. His idea of increase in tariff is because he says that it will boost US production and protect jobs, but it backfired as the economy has gone chaos because the prices of good are expected to rise. He also argues that this increase will encourage US consumers to but more american product, instead of investing from other countries.
The problem
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| Donald Trump/ Xi Jinping |
The problem of this increased tariff is that, it inflated the prices of tech products, especially iPhones. Apple produces 90% of their iphones in China, which lead to this increase. Although it is reported that they build up stock for the US market. If this state continue Apple will be forced to raise their prices of iPhones and other products. With the Apple production chain in China, India and other countries, analysis shows that this war will continue.
How will this effect the price of iPhones in the US?
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| iPhone 16 Pro Max |
The Union Bank of Switzerland (UBS) analysts approximate that the price of iPhone 16 Pro Max assembled in China will cost around $2,000. An increase of almost $800, in the meantime the same iPhone assembled in India show only $45 increase. The idea of switching the production of iPhones from china to US seems impractical and very costly. It is also expected iPhones to cost more than $3000, triple the current price by the year 2028.
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