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Apple may stop manufacturing products in China

THE trade war between the United States and China may have had a temporary truce when Donald Trump announced last week that the momentary suspension of tariff increases for products imported from the Wall Country should have made Apple executives breathe a sigh of relief in Cupertino. However, things are far from a resolution, as the Bloomberg.

According to sources close to the company's plans heard by the report, Apple and its suppliers may consider a China's exit if import tariffs on products from the country reach 25%. As is well known, Trump has constantly threatened to raise taxes on goods manufactured and imported from China, but if the new tariff is implemented, it is believed to be in the 10% range; 25% would be an extreme, more punitive measure of the American president.

The fact that most of Apple's partners focus their production precisely on China and a complete move to other countries would be a herclean operation. Still, companies (such as Foxconn, Hon Hai and Pegatron) are largely submissive to Ma, their primary source of profit, and must follow in the footsteps of the Cupertino giant wherever it goes. One of the suppliers would have already indicated alternative countries for the production of devices other than the iPhone.

Obviously, Apple hopes that this does not require the very source heard by Bloomberg He stated that there is no reason for the change for now. Still, if Trump decides to pick up on tariffs, China's departure is no longer a distant thought but a concrete plan.

Not least: according to RBC analyst Amit Daryanani estimates, if Trump raises tariffs on Chinese imports by 10%, Apple will lose about $ 1 in earnings per share (in the scenario in that all of the company's products are re-taxed and Ma itself absorbs the costs, this). If taxes rise 25 percent, however, that loss rises to $ 2.50, which is hard to manage even for one of the most powerful companies in the world.

Let's see how this case is going to unfold

via TechCrunch

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