18 hours Ago By Varun Godinho
President Donald Trump’s ‘Liberation Day’ tariffs could prove to be damaging to one of the world’s most valuable companies and to the customers of its iPhones. As Apple diversified its production away from China over the last few years, it shifted some of its iPhone production to India, AirPods to Vietnam and Mac desktops are assembled in Malaysia. India now has a 26% tariff, Taiwan is at 32%, Vietnam received a 46% tariff setback, and Malaysia faces a 24% tariff.
China is now at a 54% tariff rate after Wednesday’s 34% bump to its existing 20% tariffs. “Substantially all” of Apple’s manufacturing is done in China, India, Japan, South Korea, Taiwan and Vietnam, according to a financial filing in November. “The impact can be particularly significant if these restrictive measures apply to countries and regions where the company derives a significant portion of its revenues and/or has significant supply chain operations,” Apple wrote in the filing.
With Trump’s sweeping tariffs, all those countries are now slammed with tariffs jeopardising the company’s global supply chain. The company’s shares plunged 9.25% overnight, wiping off more A$474 billion off its market value – the largest one-day valuation wipeout on record.
Apple’s main contract manufacturer is Taiwan-headquartered FoxConn, and most of its factories are in mainland China. Up until now, Apple absorbed the price rise that resulted from previous tariffs, but it may now have to raise prices across its product lines by 17% to 18% in the US. American companies usually adjust their global product pricing in relation to their product’s US prices, which means that iPhone prices in Australia could rise sharply too.
If Apple were to pass on the increase in iPhone prices to consumers, Wedbush Securities analyst Daniel Ives estimated that an iPhone could cost as much as $2,300 (A$3,630). While some have suggested that a workaround would be for Apple to begin shifting production into the US, there are severe limitations with that move. “The reality is it would take three years and $30 billion (A$47.
45 billion) in our estimation to move even 10% of its supply chain from Asia to the US with major disruption in the process,” wrote Ives. iPhone sales generate more than half the company’s revenue, and so any dampening of consumer demand due to the price change is likely to affect its revenue. Already at the start of this year, Apple confirmed that its iPhone sales have dropped.
In Q4 of the US 2025 financial year, iPhone sales dropped 1% to A$111.16 billion..
