{"id":22543,"date":"2025-05-01T18:15:52","date_gmt":"2025-05-01T18:15:52","guid":{"rendered":"https:\/\/site.itshrt.com\/worldnews\/what-happens-to-apple-if-trumps-trade-war-forces-it-to-cut-ties-with-china\/"},"modified":"2025-05-01T18:15:52","modified_gmt":"2025-05-01T18:15:52","slug":"what-happens-to-apple-if-trumps-trade-war-forces-it-to-cut-ties-with-china","status":"publish","type":"post","link":"https:\/\/site.itshrt.com\/worldnews\/what-happens-to-apple-if-trumps-trade-war-forces-it-to-cut-ties-with-china\/","title":{"rendered":"What Happens to Apple if Trump\u2019s Trade War Forces It to Cut Ties With China?"},"content":{"rendered":"<p> <script async src=\"https:\/\/pagead2.googlesyndication.com\/pagead\/js\/adsbygoogle.js?client=ca-pub-6606220950177433\"\r\n     crossorigin=\"anonymous\"><\/script>\r\n<!-- ItShrt World News -->\r\n<ins class=\"adsbygoogle\"\r\n     style=\"display:block\"\r\n     data-ad-client=\"ca-pub-6606220950177433\"\r\n     data-ad-slot=\"1882483372\"\r\n     data-ad-format=\"auto\"\r\n     data-full-width-responsive=\"true\"><\/ins>\r\n<script>\r\n     (adsbygoogle = window.adsbygoogle || []).push({});\r\n<\/script>\r\n<br \/>\n<\/p>\n<div data-testid=\"companionColumn-0\">\n<div class=\"css-53u6y8\">\n<p class=\"css-at9mc1 evys1bk0\">Several years before Donald J. Trump entered politics, Apple and its partners built massive factories across China to assemble iPhones. Mr. Trump first campaigned for president by promising his supporters that he would force Apple to make those products in America.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">Nearly a decade later, little has changed. Instead of bringing its manufacturing home, Apple shifted some production from China to India, Vietnam and Thailand. Almost nothing is made in America, and an estimated 80 percent of iPhones are still made in China.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">Despite years of pressure, Apple\u2019s business is still so dependent on China that the tech giant can\u2019t operate without it. Moves by the Trump administration to change Apple\u2019s behavior risk damaging the world\u2019s most valuable publicly traded company. And any serious effort to move Apple\u2019s production to the United States \u2014 if that is even possible \u2014 would take a titanic effort by both the company and the federal government.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">In the four days after President Trump announced taxes on Chinese exports of 145 percent last month, Apple lost $770 billion in market capitalization. It regained some of those losses after Mr. Trump gave consumer electronics manufacturers in China a temporary reprieve.<\/p>\n<\/div>\n<aside class=\"css-ew4tgv\" aria-label=\"companion column\"\/><\/div>\n<div data-testid=\"companionColumn-1\">\n<div class=\"css-53u6y8\">\n<p class=\"css-at9mc1 evys1bk0\">On Thursday, Wall Street analysts expect Apple to report that sales increased 4 percent in the most recent quarter, partly because people rushed to buy iPhones before the tariffs kicked in. The report offers Wall Street analysts an opportunity to grill Apple\u2019s chief executive, Tim Cook, about the risk of future tariffs, price increases and the company\u2019s future in China and the United States.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">An Apple spokesman declined to make any company executives available for this article. The company said this year that it would invest $500 billion in the United States over the next four years and begin making artificial intelligence servers in Houston in 2026.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">David Yoffie, a professor at Harvard Business School who has written case studies on Apple, said the scrutiny was warranted because \u201cthey\u2019re the company most at risk in a complete breakdown of the United States and China.\u201d<\/p>\n<p class=\"css-at9mc1 evys1bk0\">Gene Munster, a managing partner at Deepwater Asset Management, which invests in emerging technology companies, estimates that a complete breakdown between the United States and China would cut the value of Apple in half or more. It would drop to being a $1.6 trillion company from a $3.2 trillion company because about a third of its sales are tied to products made in China, even if it shifts some production to other countries. And the value could drop to $1.2 trillion if it also lost its sales to Chinese customers, as its rival Samsung did after a dispute between South Korea\u2019s and China\u2019s governments. <a class=\"css-yywogo\" href=\"https:\/\/www.nytimes.com\/2024\/03\/25\/business\/china-apple-iphones.html\" title=\"\">Beijing has already discouraged iPhone<\/a> purchases by government employees.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">A major drop in Apple\u2019s value would ripple through the stock market. The company accounts for about 6 percent of the S&amp;P 500 index. That means for each dollar invested in the fund, about 6 cents goes to Apple stock. Investors, and most 401(k) owners, would see that stake cut in half.<\/p>\n<\/div>\n<aside class=\"css-ew4tgv\" aria-label=\"companion column\"\/><\/div>\n<div data-testid=\"companionColumn-2\">\n<div class=\"css-53u6y8\">\n<p class=\"css-at9mc1 evys1bk0\">Apple\u2019s roots in China run deep. Decades ago, the company worked with Beijing to set up manufacturing in China without creating a joint venture with a Chinese company, as required of many U.S. businesses. It then perfected the art of assembling devices inexpensively in China and selling products to the country\u2019s growing middle class. The combination has earned it more than 80 percent of global smartphone profits and generated $67 billion in annual Chinese sales.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">Over time, the company\u2019s ties to China have strengthened. Today, not only does it make most iPhones in China, but its Chinese suppliers also assemble parts for devices made in India and <a class=\"css-yywogo\" href=\"https:\/\/www.nytimes.com\/2022\/09\/06\/technology\/china-apple-iphone.html\" title=\"\">manufacture components and AirPods<\/a> in Vietnam.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">Apple\u2019s dependency on China has made its supply chain something of a Rorschach test for the Trump administration, which wants to bring more electronics manufacturing to the United States. Apple has more power than any other electronics company to deliver on the administration\u2019s goal. It makes more smartphones than anyone else and spends more money on components than rivals, giving it tremendous sway over where its suppliers operate.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">The Trump administration wants Apple to begin that process. In an April television interview, Commerce Secretary Howard Lutnick said that \u201cthe army of millions and millions of human beings screwing in little, little screws to make iPhones \u2014 that kind of thing is going to come to America.\u201d<\/p>\n<p class=\"css-at9mc1 evys1bk0\">But pressuring Apple to leave China could backfire. The new tariffs could force Apple to raise iPhone prices or accept smaller smartphone profits. Samsung phones, which are made in Vietnam and not subject to Chinese tariffs, could be cheaper by comparison. Apple could become less competitive at home \u2014 a red line that Mr. Trump seldom wants to cross.<\/p>\n<\/div>\n<aside class=\"css-ew4tgv\" aria-label=\"companion column\"\/><\/div>\n<div data-testid=\"companionColumn-3\">\n<div class=\"css-53u6y8\">\n<p class=\"css-at9mc1 evys1bk0\">Apple has resisted making iPhones and other devices in the United States because the company\u2019s operations team has determined that it would be impossible, said two people familiar with the analysis who spoke on the condition of anonymity. A decade ago, it had a bad experience <a class=\"css-yywogo\" href=\"https:\/\/www.nytimes.com\/2019\/01\/28\/technology\/iphones-apple-china-made.html\" title=\"\">sourcing screws<\/a> and finding reliable workers to assemble a Mac computer in Texas.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">In China, Apple\u2019s suppliers are able to bring together 200,000 people. They work at factories supervised by thousands of engineers with years of manufacturing experience. Most live in dormitories near the iPhone plant, where displays and other components move down assembly lines longer than a football field.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">Finding that many employees and experienced engineers would be impossible in most American cities, said Wayne Lam, an analyst with TechInsights, a market research firm. He said Apple would need to develop more automated processes with robots to make up for the smaller population in the United States.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">Mr. Lam estimates that if Apple did set up operations in the United States, it would need to charge $2,000 for an iPhone \u2014 up from about $1,000 now \u2014 to keep its current profits. The price could drop to $1,500 in future years as the company reduced the costs of training employees and making components.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">\u201cIn the short term, it\u2019s not economically feasible,\u201d Mr. Lam said. He added that it also made little sense to relocate production of a device that was nearly 20 years old and could be disrupted by a new gadget that caught on with consumers.<\/p>\n<\/div>\n<aside class=\"css-ew4tgv\" aria-label=\"companion column\"\/><\/div>\n<div data-testid=\"companionColumn-4\">\n<div class=\"css-53u6y8\">\n<p class=\"css-at9mc1 evys1bk0\">Apple has shown a willingness to move its supply chain when there are incentives. In 2017, it began a process to make iPhones in India because the country had high taxes on imports that would have made prices increase to a point where Apple could not have claimed a slice of the world\u2019s fastest-growing smartphone market.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">Today, Apple makes about 20 percent of its iPhones sold around the world in India. It also makes some components there, including the metal frame. But it relies on Chinese companies to assemble the displays and other complex parts.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">Matthew Moore, who spent nine years as a manufacturing design manager at Apple, said India had another advantage that America didn\u2019t: \u201cEngineers, everywhere.\u201d<\/p>\n<p class=\"css-at9mc1 evys1bk0\">To lure Apple and electronics companies to the United States, Mr. Moore believes, the Trump administration will need to invest in education for degrees in science, technology, engineering and math. He also thinks that the country should encourage loans for new manufacturing facilities, much as it does for housing with Fannie Mae and Freddie Mac.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">Last month, Apple bought itself a temporary break. Mr. Cook, who personally donated $1 million to Mr. Trump\u2019s inauguration, <a class=\"css-yywogo\" href=\"https:\/\/www.nytimes.com\/2025\/04\/13\/us\/politics\/trump-tariffs-china-chips-technology.html\" title=\"\">lobbied the Trump administration<\/a> for the exemption it gave to iPhones and other electronics from the 145 percent tax on Chinese exports. It\u2019s temporary, though. The administration has said it plans to issue more targeted tariffs on tech products.<\/p>\n<\/div>\n<aside class=\"css-ew4tgv\" aria-label=\"companion column\"\/><\/div>\n<div data-testid=\"companionColumn-5\">\n<div class=\"css-53u6y8\">\n<p class=\"css-at9mc1 evys1bk0\">Without government investments, Apple and smaller manufacturers will continue making things in China because it has excess equipment and engineers, said Mr. Moore, who started Cruz, a company that makes hardware products like blenders.<\/p>\n<p class=\"css-at9mc1 evys1bk0\">\u201cI don\u2019t think the ship has sailed, but it\u2019s absurd to think in four years we\u2019re going to make iPhones here,\u201d Mr. Moore said. \u201cIt would take 10 years.\u201d<\/p>\n<\/div>\n<aside class=\"css-ew4tgv\" aria-label=\"companion column\"\/><\/div>\n<p><script async src=\"https:\/\/pagead2.googlesyndication.com\/pagead\/js\/adsbygoogle.js?client=ca-pub-6606220950177433\"\r\n     crossorigin=\"anonymous\"><\/script>\r\n<!-- ItShrt World News -->\r\n<ins class=\"adsbygoogle\"\r\n     style=\"display:block\"\r\n     data-ad-client=\"ca-pub-6606220950177433\"\r\n     data-ad-slot=\"1882483372\"\r\n     data-ad-format=\"auto\"\r\n     data-full-width-responsive=\"true\"><\/ins>\r\n<script>\r\n     (adsbygoogle = window.adsbygoogle || []).push({});\r\n<\/script>\r\n<br \/>\n<br \/><a href=\"https:\/\/www.nytimes.com\/2025\/05\/01\/technology\/apple-china-tariffs.html\">Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Several years before Donald J. Trump entered politics, Apple and its partners built massive factories across China to assemble iPhones.<\/p>\n","protected":false},"author":1,"featured_media":22544,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[39],"tags":[1076,335,1263,469,1208,109],"class_list":["post-22543","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-technology","tag-apple-inc","tag-factories-and-manufacturing","tag-iphone","tag-politics-and-government","tag-smartphones","tag-united-states-international-relations"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v24.2 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>What Happens to Apple if Trump\u2019s Trade War Forces It to Cut Ties With China? - World News<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/site.itshrt.com\/worldnews\/what-happens-to-apple-if-trumps-trade-war-forces-it-to-cut-ties-with-china\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"What Happens to Apple if Trump\u2019s Trade War Forces It to Cut Ties With China? - World News\" \/>\n<meta property=\"og:description\" content=\"Several years before Donald J. 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