US President Donald Trump recently celebrated the implementation of sweeping global tariffs, claiming that “jobs and factories will come roaring back” as part of his “Liberation Day” address. However, the tariffs, which are expected to significantly raise prices on goods like clothing and electronics, may ultimately be paid by American consumers. A prominent tech analyst has warned that the price of an Apple iPhone could skyrocket to as high as $3,500 if it were made in the US.
Trump and his economic team have asserted that these tariffs will lead to a reshoring of manufacturing jobs to the US, eventually employing millions of Americans. However, Dan Ives, global head of technology research at Wedbush Securities, dismissed these claims, calling them unrealistic. He explained that manufacturing iPhones in the US would be extremely costly because the current complex production ecosystem in Asia would need to be replicated in the US. This would result in iPhones being priced much higher, at around $3,500.
Ives also noted that it would take Apple around $30 billion and three years to move even 10% of their supply chain to the US. Apple’s production and assembly processes have been based in Asia for decades, as American companies focused more on software and design, which bring in higher profit margins. This shift has helped Apple become one of the world’s most valuable companies.
Since Trump’s inauguration, Apple’s stock has dropped by about 25%, primarily due to concerns over how tariffs would affect its extensive supply chain, particularly in China and Taiwan, where 90% of iPhones are assembled. Ives highlighted that no company is more vulnerable to the impact of tariffs than Apple, calling it an “economic Armageddon” for the tech industry.
Key components of iPhones, such as chips, are made in Taiwan, while screen panels come from South Korea, and final assembly occurs in China. In February, Apple announced plans to invest $500 billion in the US over the next four years to expand production outside China and avoid Trump’s tariffs.
Tech analysts agree that the cost of iPhones is likely to rise, even if Apple keeps its supply chains in their current locations. Some estimates suggest that iPhone prices could increase by 43% if Apple fully passes on the cost of higher tariffs to consumers. Others, like Neil Shah, vice president of research at Counterpoint Research, believe the rise will be closer to 30%, depending on where the phones are made. Apple has already begun shifting some production to countries like India and Brazil, where tariff rates are lower, but these countries might not have the capacity to replace China as a manufacturing hub.