Apple has become the latest company to be embroiled in the simmering tensions between the US and China, after President Donald Trump said tariffs could be placed on mobile phones and laptops made in China.
Speaking to the Wall Street Journal ahead of this week’s G20 Summit, Trump implied mobile phones and laptops could be included in the next round of tariffs, saying: “Maybe. Maybe. Depends what the rate is.”
He added: “I mean, I can make it 10%, and people could stand that very easily.”
China is a crucial market for Apple, with many of its products made there and Greater China accounting for around 20% of revenue.
Apple’s shares, already under pressure over concerns the latest iPhones are not selling as well as expected, fell on the President’s comments. They lost 1.6% in post-close trading on Monday and were expected to slip further after the opening bell on Tuesday.
Apple has now seen it its share price lose more than 20% since October to trade below $175.
However, Michael Hewson, chief market analyst CMC Markets UK, said of the latest tariff threat: “Any negative effects are likely to be overstated given that the firm was able to absorb the impact of lifting the ceiling price on its most expensive iPhone model by much more than that with its recent upgrades.”
The US President has so far imposed tariffs on $200bn of Chinese goods, around 40% of the items imported into America from China. In return, China has imposed its own trade restrictions on US goods.
Trump is due to raise the tariffs from 10% to 25% in January. There had been speculation that he would strike a deal with Chinese president Xi Jinping to avert the increase, but on Monday evening the US President stated that was “highly unlikely” and warned he could impose tariffs on another $267bn of goods, which would account for nearly all Chinese products imported into America.