Apple extended a Thanksgiving-week slide that drained 11 percent of its market value after President Trump suggested iPhone parts shipped from China might be subjected to new U.S. tariffs.
The president told the Wall Street Journal on Monday that he’s ready to impose duties on the $267 billion of Chinese imports that have been unaffected so far if he doesn’t strike a deal President Xi Jinping at this week’s G-20 meeting in Buenos Aires. The levies already in place, intended to boost U.S. manufacturing, have forced American companies to pay more for supplies and revise global supply chains with an emphasis on factories closer to the point of sale.
Apple’s smartphones and laptops imported from China, largely exempt now, might be included, Trump specified in an interview with the Journal. That contradicts aides who said the popular products could be exempted because of concerns about a consumer backlash.
“Depends on what the rate is,” the president told the news organization, referring to duties that have varied from 10 percent to 25 percent. “I mean, I can make it 10 percent and people could stand that very easily.”
Trump said he also plans to ramp up existing tariffs on some $200 billion of imports to 25 percent from 10 percent.
“This could simply be a negotiating tactic ahead of the G-20 summit later this week, though we do note that this administration has proven a willingness to push forward with such actions,” said Timothy Arcuri, an analyst with Swiss lender UBS.
A 10 percent tariff might trim operating profit in Apple’s 2019 budget year by $1.5 billion, while a 25 percent surcharge would cost $3.8 billion, Arcuri said.
The company’s shares slid 0.6 percent to $173.51 in New York trading on Tuesday.
