Despite India being about to face U.S. President Donald Trump’s 50% tariff on August 27, Apple, a U.S. company that manufactures most of its iPhones there, will not be affected due to the exemptions for semiconductor-powered devices.
Currently, the tariff for specific semiconductors is being reviewed by the Trump administration, and until it finishes, no iPhones exported to the U.S., including those from India, will face any levies. Still, Trump promised that no one is “getting off the hook.”
Apple originally focused its iPhone manufacturing in China before spreading the production places elsewhere when the nation faced the COVID-19 pandemic. The company then shifted its primary production to India after Trump began placing a massive tariff rate on Chinese goods.
Between April and June this year, 71% of Apple’s iPhone in the U.S. market came from India, according to Counterpoint Research. As of now, more than a fifth of global iPhone production is supplied from this Asian country.
Nonetheless, analysts still warned the 50% tariff on Indian goods could still affect this smartphone company. They estimated that the high tariff rate may increase the cost of assembly in India higher than the cost of production in Vietnam or China.
Still, Apple may choose to face higher costs than giving up its operation in India since most of its consumers purchase iPhones through operators on monthly plans. This will hike the price by a few dollars, which is unlikely to affect the company’s sales.
