iPhone prices face pressure as Trump warns of a 104% tariff on China.

      Apple iPhone 16 Pro Max

      Andy Boxall / Digital Trends

      Another day, another tariff.

      On Monday, President Donald Trump threatened to impose an additional 50% tariff on China — added to the existing 54% — if the country does not retract the 34% tariff it has recently placed on imports from the U.S., which was introduced in response to tariffs that Trump announced on April 2. This exemplifies what a trade war entails.

      Trump mentioned that the new cumulative tariff of an astounding 104% on Chinese imports will be implemented on Wednesday, April 9, should China not comply.

      Since the majority of iPhones continue to be produced in China, this could lead to significant price increases for Apple’s popular devices, in addition to various other products.

      If Apple decides to pass the full 104% import tax on to its consumers, then the iPhone 16 Pro Max (1TB), currently priced at $1,599, would skyrocket to an astonishing $3,262.

      Conversely, the newly launched iPhone 16e — Apple’s most budget-friendly model — would see its price rise substantially to $1,222 for the 128GB version, up from its original price of $599.

      At the same time, the price of the 128GB iPhone 16 would climb from $799 to $1,632.

      The good news is that Apple is unlikely to transfer the entire import tax burden to its customers. Although the tech giant has ample cash reserves to absorb at least some of the expenses, it seems quite unavoidable that U.S.-based consumers will face higher prices given the current circumstances.

      This scenario presents a substantial challenge for Apple CEO Tim Cook, whose executive team will likely be reviewing numerous spreadsheets to find ways for the company to absorb at least part of the costs in order to avoid alienating customers when it comes to price adjustments.

      To alleviate the impact, Apple will attempt to convince component suppliers and manufacturers to lower their prices, which would allow the company to decrease production costs to counterbalance the effect of the tariffs. It is probable that the company is also looking to accelerate the diversification of its supply chain to other countries with lower tariffs.

      Additionally, Apple may be in discussions with Trump administration officials to secure a tariff exemption for the iPhone and other products, a feat it accomplished during the President's initial term.

      Reports suggest that Apple has engaged in pre-tariff stockpiling to maintain its current pricing structure while hoping that a trade agreement can be reached between the U.S. and China to stabilize the ongoing volatility.

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