Hitting Where It Hurts: Apple May Move Out Its Manufacturing From China If Tariff Escalates To 25 Per Cent

Hitting Where It Hurts: Apple May Move Out Its Manufacturing From China If Tariff Escalates To 25 Per CentApple Logo (Stuart C. Wilson/Getty Images)

Apple’s Chinese suppliers are intending to move their production out if the trade war between China and United States ensues increase in US import tariffs, reports Financial Express.

If the US government imposes a 10 per cent import tariff on smartphones, the suppliers are willing to continue production but should 25 per cent tariff gets levied they are planning to move out of China.

The majority of iPhones are manufactured and shipped around the world by the Hon Hai Precision Industry in China.

The iPhone, till now, has been spared in the ongoing trade war between the two economic giants. However, President Donald Trump last month announced that the US could slap duties on laptops and smartphones.

China has, for a long time, been the production base for the American technology giant’s devices like iPads and iPhones . However, following the trade war, Apple is in a wait and watch mode.

According to the report, a 10 per cent tariff by US on electronics import could result in a $1 reduction in earnings-per-share (EPS) of Apple while a 25 per cent duty would decline the EPS by $2.50.