Tomorrow is the first day of the new month. Many are looking forward to September as the summer heat fades and autumn begins. The continuation of the baseball series becomes more exciting and the NFL begins a new season. But this year, something new is happening from September 1st. Customs duties of 15% will come into effect on Chinese goods imported into the United States for a value of 300 billion dollars. To be clear, tariffs are just an import tax paid by US companies. These companies can absorb the additional cost of the tax, reduce profit margins and bring down share prices. Or, these companies can pass all or part of the tax on consumers in the form of higher prices, which can also harm the economy.
Originally, Apple's iPhone and other handsets imported from China were to be taxed 15% from 1 September. However, President Donald Trump has decided to delay the taxation of these products until December 15 so that higher prices do not slow down the economy during the holiday shopping season. However, all products do not benefit from this delay and from tomorrow, some Apple devices will be taxed. While the technology giant designs most of its products in the United States, the vast majority of them are manufactured in China by subcontractors including companies such as Foxconn, Pegatron and Wriston. Apple produces models of the iPhone in India, but certainly not enough to offset a significant amount of Chinese production.
If Apple decides to assume the cost of the tax, the retail prices of the company's devices will remain unchanged.
As of tomorrow, two of Apple's most popular products, Apple Watch and AirPod, will be subject to 15% import tax, as well as headphones and other products of the society. Apple may decide to consume the additional cost, which is already the case for some cases for iPhone and iPad, and consumers will notice no change in price. But if Apple decides to share the pain with its customers, Americans will dig a little deeper into their pockets to buy these products.
Starting tomorrow, Apple will have to pay a 15% import tax on HomePod smart speakers imported by its Chinese manufacturers.
"The US that adds tariffs to any Apple product with no corresponding compensation to mitigate the negative effects cross the Rubicon in many areas." We think the US does not want to be the first to add tariffs to Apple, Apple arguably the main American company and the face of US companies in China.The prospect of a first American protectionist approach that penalizes a leading American company while China does not penalize Apple seems to renounce morality. – Gene Munster, Wolf Ventures
- Apple Watch and watch bands.
- AirPods wireless Bluetooth headphones.
- HomePod smart speaker.
- Specific helmets under the name Beats.
- Apple iMac Computers.
- Repair parts for iPhone.
- Nand flash chips, used for iPhone storage.
The devices listed above accounted for at least 10% of Apple's revenue last year. The Apple Watch and the AirPod are two devices belonging to the rapidly growing segment of Apple's apparel technologies, which recorded a 48% increase over the third quarter of the previous fiscal year compared to the previous year. same quarter (April to June) of this year. Some analysts believe that this unit is the one that will generate the most powerful growth within Apple; However, if the two most important devices inside this unit are paralyzed by higher prices, this changes the outlook for the segment and for the company as a whole. Again, if Apple decides to consume the entire tax, consumers will not notice any price changes.
