1 week Ago By Cahal Milmo
Donald Trump’s trade war with China is set to ignite a battle over Britain’s consumer tech market, experts have warned.Chinese firms are seeking to displace products such as Apple’s iPhone with cheaper – and often more advanced – alternatives. The eye-watering tariffs imposed between Washington and Beijing are widely expected to result in steep price rises for market-leading goods such as the iPhone.
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addToArray({"pos": "inread-hb-ros-inews"}); }The iPhone is largely made in China and is now subject to swingeing import levies of up to 125 per cent imposed by the US President. The highly integrated electronics supply chain, which sees components for iPhones sourced from nearly 50 countries, has led to predictions that the price of Apple’s leading product could treble in America as manufacturers recoup increased costs.While the price rises are expected to be highest in the US and China, the cost of an iPhone and other consumer tech is also set to rise significantly in the UK.
Analysts predict an increase of as much as £400 on top of the current £1,200 cost of an iPhone 16 Pro Max. Ben Barringer, global technology analyst at investment firm Quilter Cheviot, said the unfolding cycle of tariffs would have a “profound impact” on global supply chains, inevitably raising prices. if(window.
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adverts) { window.adverts.addToArray({"pos": "mpu_tablet_l1"}); }Before the White House announced a 90-day pause in its reciprocal tariffs, except for China, Mr Barringer said: “The tariffs announced are going to have a profound impact on supply chains globally, and not just on US consumers.
We are likely to see retaliatory measures introduced by other countries, which will just escalate the cost of goods – including for those consumers buying in the UK.” Chinese tech giants eye UK marketWhen placed alongside the unpredictability of policymaking by the White House and leading Trump acolytes such as Elon Musk, the result of such turbulence is what experts say is a unique opportunity for resurgent Chinese tech companies to gain market share in the UK and Europe.Even before Trump unleashed his attempt to rewire the global economy with China as his chief target, Beijing had been preparing to unleash a vast drive to increase exports by adding huge amounts of new manufacturing capacity and updating existing plants with robots and automation.
Chinese banks have loaned some $1.9tn (£1.5tn) to industrial firms over and above normal lending in the last four years.
#color-context-related-article-3637534 {--inews-color-primary: #3759B7;--inews-color-secondary: #EFF2FA;--inews-color-tertiary: #3759B7;} Read Next square PATRICK COCKBURN .inews__post__label__newsletter{background-color: #0a0a0a;color: #ffffff;}Newsletter (£)Trump is deciding the fate of billions with demonic frivolityRead MoreBBYD, the Chinese electric car maker, is building two new factories, each with a capacity to produce twice the number of vehicles as Volkswagen’s Wolfsburg plant – hitherto the world’s biggest car factory.Similarly, Huawei, the electronics giant that was the target of a long-running campaign by the White House to remove its technology from mobile phone networks in the US and other countries, including the UK, has invested vast sums in R&D to reinvent itself as a market leader in areas ranging from smartphones to automotive components and healthcare data systems.
Huawei’s latest phones, which include a device capable of unfolding into a full-sized tablet, are increasingly regarded as more innovative than those being offered by rivals such as Apple. The California-based firm has already lost its ranking as the top seller of smartphones in China after being displaced by Huawei and another local producer, Vivo.Consequently, Chinese firms may find themselves with an increasingly receptive audience among British and European consumers and businesses unimpressed by higher prices for American tech.
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addToArray({"pos": "mpu_tablet_l2"}); }Runar Bjorhovde, a senior analyst at Canalys, a specialist technology consultancy, said: “I think there has been a realisation for a while in Europe that it needs to find its own balance between China, the rest of Asia and the US. Europe has been leaning towards the US for decades, but this is a real wake-up call for it to find the right balance.Lenovo is hoping to expand its products such as this dual touchscreen laptop in European markets (Photo: Joan Cros/NurPhoto)“The US is no longer the steady partner that it once was.
Just how that works out is difficult to say, but part of that better balance could be to let more Chinese companies in.“If you look at consumer technology, the market has been dominated by companies from the US, South Korea and Japan. However, Chinese companies have high ambitions in Europe and have invested heavily for a long time.
Until now, they have found it hard to succeed, but I think that door might now open a lot more.”Security fearsCertainly, some leading Chinese brands are increasingly achieving significant footholds in the European market. Computer company Lenovo, the world’s largest manufacturer of PCs, opened a factory in Hungary in 2021.
BYD is also expected to start making vehicles for its luxury marque – Denza – in the country later this year.Huawei is also well placed to improve its share of the UK and European markets with consumer and health technologies. However, it continues to face accusations – repeatedly denied by the company – that it has close links to the Chinese state and represents a security risk.
All US companies are banned from doing business with Huawei, including selling the company advanced microchips. In Britain, the Huawei Cyber Security Evaluation Centre, set up by the UK Government in 2010 to assess whether the company’s mobile phone network equipment poses any risks to national security, is understood to remain operational.However, the Chinese tech titan, which last year made profits of $8.
6bn (£6.7bn) and devotes more than half its workforce – some 113,000 people- to R&D, has since diversified its range of activities and drastically reduced its reliance on American technology ecosystems. The company has developed its own operating system – equivalent to iOS or Android – and found a way to make its own advanced chips for artificial intelligence.
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addToArray({"pos": "mpu_tablet_l3"}); }#color-context-related-article-3637534 {--inews-color-primary: #3759B7;--inews-color-secondary: #EFF2FA;--inews-color-tertiary: #3759B7;} Read Next square PATRICK COCKBURN .inews__post__label__newsletter{background-color: #0a0a0a;color: #ffffff;}Newsletter (£)Trump is deciding the fate of billions with demonic frivolityRead MoreConsequently, Huawei, which saw its consumer tech sales increase by 38 per cent last year, is finding new outlets for its products. Last year, it unveiled the fruits of a collaboration with a leading Spanish hospital, where it has provided data storage technology for patient records, including advanced anti-ransomware measures.
Last month, BMW announced it was integrating Huawei’s mobile phone app into its car sold on the Chinese market.Huawei declined to comment on its wider ambitions for the European and UK markets.However, one data industry executive said: “Huawei is coming back very strongly.
It has phenomenal resources for research and development. I would not be at all surprised if it was looking for opportunities for partnerships and sales in the UK and Europe now that the Americans have torn up the previous system.”Other industry sources advised caution, pointing out that concerns about Chinese economic strength and Xi Jinping’s agenda remain strong despite Beijing’s desire to portray itself as a model of stability in the face of Washington’s desire to generate global turbulence.
At the same time, some senior figures argue that restricting China as a trade partner would be ill-advised at a time when the boundaries of global commerce are in flux.Chris Southworth, secretary general of the International Chamber of Commerce UK, an umbrella body for business organisations, said: “We are going through a major reset of trade. You’ve got some of the best tech in the world these days coming from China.
The world has moved on and we have to think differently about our trade with Europe and also with China. “We shouldn’t be placing a limit around our number one priority, which is growth.”.
