2019 iPhones Won’t Be Subject to Trump Tariffs? — For Now

iPhone U.S. China Trade War Credit: Mavas_bd / Shutterstock
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Apple has been struggling to avoid its products becoming casualties of U.S. President Donald Trump’s trade war with China, especially after the Trump administration slapped a 25 percent tariff on Apple accessories earlier this year, and suggested that absolutely no China-manufactured products would be exempt from the next round of tariffs.

As a result, Apple once again petitioned the Trump administration to exempt Apple’s main product lineup, including the iPhone, iPad, Apple Watch, and Mac Pro, from future tariffs, citing Apple’s economic contributions and the need for the U.S. to remain competitive in the world market. Despite this, however, Trump denied the requests to exempt the Mac Pro, suggesting Apple build a plant in Texas instead, and then announced a more comprehensive round of tariffs earlier this month. Despite Apple’s protestations, many fully expected these would encompass everything manufactured in China, to the extent that Apple and its suppliers have been starting to move production out of China, and Apple’s stock dropped sharply.

However, it now looks like the iPhone will be getting a stay of execution. The U.S. Trade Representative’s officeannounced this week that some products are having their tariffs delayed while others are being removed from the new China tariff list entirely. The duties had been set to go into effect on September 1st, but now the USTR says that some products have been removed entirely from the list due to “health, safety, national security and other factors” while a broad list of electronics categories such as cellphones, laptops, video game consoles, and computer monitors will have their tariffs delayed until December 15th, along with clothing products and shoes and “certain toys” as part of the public comment and hearing process.

Apple Stock Rallies for Holiday Shopping

As a result of the announcement, Apple’s stock rallied, gaining over 5% in less than five minutes after the news broke, basically reversing the downturn following Trump’s announcement of the new tariffs in early August.

While a detailed list has yet to be published, it’s safe to say that Apple’s iPhones, iPads, and MacBooks are included, in the very least. The delay not only means that Apple won’t to worry about tariffs showing up on the eve of its launch of three new iPhones in September — not to mention the iPads and MacBooks that are inevitably coming soon after — but also means that there will be less concerns about an economic downturn right in the middle of the holiday shopping season.

It’s Not Over Yet

That said, it sounds like the tariffs on Apple’s products have merely been delayed, and while that’s definitely good news for Apple’s fall product lineup — almost all of which will certainly be on sale before the Dec. 15th deadline — it doesn’t mean that Apple can relax and stop fighting the tariffs. Thus far, it’s a safe bet that it’s only been Apple’s repeated petitioning of the Trump administration that has allowed it to avoid the tariffs thus far, which is a fight that the company has been engaged in since last year. However, there is also some hope that the “public comment and hearing process” referred to in the USTR announcement will open the door for more consideration and review of the new tariff list in the hopes that Apple can be granted a full exclusion.

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