Suggested US tariffs may affect the price Apple pays for iPhones if they go ahead. While Apple is already facing a 25% charge charged for issues and chargers coming out of China, but so far, iPhone sales have not been affected. It can change.
The office of the US Trade Representative has started the approval process which may mean that an additional $ 300 million in Chinese-produced products will be subject to tariff. This can come into effect as soon as June and affect iPhones and similar products.
The use of tariffs is the Trump administration's attempt to force the Chinese government to the negotiating table, but if it does not, the Add-ons will happen. According to JP Morgan via CNBC these prices may mean that an iPhone XS sees a 14% price increase, creating an iPhone 999 iPhone at around $ 1142.
"We estimate a price increase of around 14% is required to absorb the effect of a 25% tariff, and keep margin dollars for all players in the supply chain constantly, JP Morgan said in a note to clients Tuesday.
This is all dependent on how Apple would deal with tariffs. There are suppliers who can also absorb them, which is unlikely, and there is also a chance that a combination of these may occur or that the cost can only be transferred to the customer.
Let's hope It doesn't happen because no one wants to spend that kind of money for the entry level iPhone comes in July.
But JP Morgan said that Apple is more likely to absorb the cost of the fare and hit the revenue instead of increasing the price of the phone.The bank estimates a total decline in the iPhone gross margin of 4% if Apple does not transfer the tariff to its customers.
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