Agencies
Your favourite iPhone could soon become much pricier, thanks to new tariffs imposed by the United States.
President Donald Trump imposed a series of sweeping duties on countries around the world that could drastically alter the landscape of global trade, and consumer goods like iPhones could be among the hardest hit.
Prices of the Apple-made phones could increase between 30% to 40% if the company was to pass on the cost to consumers, analysts said on Thursday.
Most iPhones are still made in China, which was hit with a 54% tariff. If those levies persist, Apple has a tough choice: absorb the extra expense or pass it on to customers.
Shares of the company closed down 9.3% on Thursday, hitting their worst day since March 2020.
Apple sells more than 220 million iPhones annually, and its biggest markets are the United States, China, and Europe.
The cheapest iPhone 16 model was launched in the U.S. with a sticker price of $799, but it could cost as much as $1,142, according to calculations based on projections from analysts at Rosenblatt Securities. They say the cost could rise by 43% if Apple is able to pass that on to consumers.
A more expensive iPhone 16 Pro Max, with a 6.9-inch display and 1 terabyte of storage, which currently retails at $1,599, could cost nearly $2,300 if a 43% increase were to pass to consumers.
In his first term as president, Trump imposed tariffs on a wide range of Chinese imports to pressure U.S. companies to bring manufacturing back to the United States or to nearby countries such as Mexico, but Apple secured exemptions or waivers for several products. This time, he has not yet granted any exemptions.
"This whole China tariff thing is playing out right now completely contrary to our expectation that American icon Apple would be kid-gloved, like last time,” Barton Crockett, analyst at Rosenblatt Securities, said in a note.
The iPhone 16e, launched in February as a cheaper entry point for Apple’s suite of artificial-intelligence features, costs $599. A 43% price hike could push that cost to $856, and prices of other Apple devices could jump as well.
Many customers pay for their phones over a period of two or three years through contracts with their cellular providers.