Trump’s 25% Tariff Threat Is Nothing Compared to US Production Costs

The post Trump’s 25% Tariff Threat Is Nothing Compared to US Production Costs appeared first on Android Headlines.

May 26, 2025 - 16:00

For a brief moment, it seemed like Apple and US President Donald Trump were in good terms. Trump seemed quite happy with Apple, but his recent comments on Truth Social suggest otherwise. Trump subtly threatened Apple that if it did not move iPhone production to the US, it could end up paying at least 25% in tariffs.

Will Apple move iPhone production to the US?

25% tariffs are a lot. We don’t know exactly how much Apple pays to produce its iPhones, but it’s safe to assume that Apple will not eat those costs. Those costs will most likely be passed on to consumers. This means we’re looking at a potential price hike of 25%, if not higher.

It makes sense that Apple would want to try to build more iPhone production facilities in the US, right? Maybe not. Analyst Ming-Chi Kuo opines that Apple eating those tariffs could be a better idea. This is because Apple doesn’t solely rely on China for its iPhone production.

The company has an extensive network of suppliers around the world. Apple has also spent decades refining these supply chain networks, which means that moving all of its iPhone production stateside isn’t as simple as uplifting one factory from one country and plopping it down on US soil.

Not to mention, labor costs in the US are higher than in other countries, such as China. This means that even if Apple were to avoid paying the 25% tariffs, its other costs could be even higher.

However, as some of the comments to Kuo’s post have pointed out, Trump did not cap tariffs. This means that if Apple were to hold out and insist on building its iPhones in China or anywhere else in the world, who’s to say that Trump wouldn’t bump those tariffs even higher?

Apple has repeatedly stated that moving manufacturing to the US isn’t possible. Apple’s late co-founder, Steve Jobs, and its current CEO, Tim Cook, have pointed out that the US doesn’t have the skilled labor or equipment needed for the precise work required to make its iPhones.

We’re not saying it’s impossible, but it’s not something that is achievable overnight.

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