Apple iPhones may see a price increase due to President Trump’s reciprocal tariffs impacting around 90 foreign countries, set to go into effect on Wednesday, but are currently postponed for 90 days, except for tariffs on China.
The White House announced on Tuesday that it will implement a 104% tariff on all goods from China imported into the U.S., starting Wednesday at 12:01 a.m. EDT. Later that day, Mr. Trump escalated the tariff to 125%, taking effect immediately.
The starting price for the popular device, with the most basic model being the iPhone 16e at $599, is expected to rise by several hundred dollars based on Apple’s reaction to the extensive tariffs. The iPhone 16 Pro 128 GB, equipped with Apple Intelligence, is currently priced at $999.
The iPhone represents approximately half of Apple’s overall revenue, with most units being manufactured in China.
Dan Ives, a tech analyst from Wedbush Securities, noted in a Tuesday research report that the additional tariffs could lead to a “category 5 price storm” for personal electronics and other devices. He likened taxing China and other countries at these rates to “flipping a boat upside down in the ocean without life rafts.”
What increase can we expect for iPhone pricing?
The iPhone 16 Pro Max 256 GB, assembled in China, currently retails for $1,199. Following the new tariffs on imports from China, analysts from UBS Investment Research predict the price might surge by $675, bringing it up to $1,874 — a 56% hike.
The iPhone 16 Pro 128 GB, manufactured in India and priced at $999, could see an increase to $1,119, indicating a 12% rise as per the investment bank’s findings.
An April 3 report by Rosenblatt Securities suggested that Apple could increase iPhone prices by as much as 43% to mitigate the impact of the reciprocal tariffs.
Apple has not provided any comments regarding how the Trump tariffs may influence iPhone pricing.
What if Apple decided to relocate production to the U.S.?
President Trump has stated that the new U.S. tariffs are intended to encourage both domestic and foreign companies to manufacture within the U.S. However, for Apple and other businesses, moving production to the U.S. would result in significantly higher labor costs, which would likely be passed on to consumers.
If Apple were to start assembling iPhones in the U.S., the cost of a device that previously sold for $1,000 would escalate to approximately $3,500 if produced in New Jersey, Texas, or any other state, according to Ives.
“To suggest we can merely produce this in the USA disregards the complexity of the Asia supply chain and the manufacturing processes for electronics, chips, semi fabs, hardware, smartphones, etc. that have been established for U.S. consumers over the last three decades,” he stated in a report.
As a consequence, Ives expresses skepticism that tariffs alone would incentivize companies to shift their manufacturing away from low-cost locations like China to the U.S., deeming the notion “absurd.”
Nonetheless, some companies, including Apple, may explore ways to adjust their supply chains to dodge the steepest tariffs. For instance, Apple is reportedly planning to increase its iPhone production in India to lessen its dependence on China, as noted by the Wall Street Journal citing sources familiar with the initiative.
