iPhone could soar in price to $2300 due to Trump’s tariffs – Reuters

According to Reuters, due to US tariffs, the iPhone may soon become much more expensive, writes UNN.

DetailsUS President Donald Trump has reportedly introduced a number of large-scale tariffs for countries around the world, “which could fundamentally change the landscape of world trade, and consumer goods such as the iPhone could be among the hardest hit,” analysts said on Thursday, “with prices rising by 30-40% if the company passes the costs on to consumers.”

Most iPhones are still manufactured in China, which has been affected by a 54% US tariff. If these tariffs remain in place, Apple will have a difficult choice: cover the additional costs or pass them on to customers.

The company’s shares closed down 9.3% on Thursday, their worst day since March 2020.

Apple sells over 220 million iPhones a year; its largest markets are the US, China and Europe.

The cheapest iPhone 16 model was released in the US for $799, but could cost up to $1142, according to calculations based on forecasts by Rosenblatt Securities analysts, who say the cost could rise by 43% if Apple can pass that price on to consumers.

A more expensive iPhone 16 Pro Max with a 6.9-inch display and 1 terabyte of memory, which currently retails for $1599, could cost around $2300 if the 43% increase is passed on to consumers, the publication writes.

“This whole Chinese tariff story is now playing out completely contrary to our expectations that the American icon Apple would be in a children’s apron, as it was last time,” said Barton Crockett, an analyst at Rosenblatt Securities.

The iPhone 16e, released in February as a “cheaper entry point for Apple’s suite of artificial intelligence features,” costs $599. A 43% price increase could raise that price to $856.

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However, other analysts noted that iPhone sales in the company’s main markets are falling as Apple Intelligence, a suite of features that helps summarize messages, rewrite emails, and give users access to ChatGPT, has failed to excite buyers.

Expert reviews have shown that these features, while innovative, are not a compelling enough reason to justify upgrading to new models.

Stagnant demand could affect Apple’s profits, especially if costs rise due to tariffs, the publication writes.

Angelo Zino, an equity analyst at CFRA Research, said it would be difficult for the company to pass more than 5-10% of the cost on to consumers.

“We expect Apple to postpone any significant price increases on phones until this fall, when the iPhone 17 is due out, as that is usually how it handles planned price increases,” the analyst says.

Even with some production moved to Vietnam and India, most iPhones are still manufactured in China, and these countries have not escaped tariffs either: Vietnam has received 46% tariffs and India 26%.

According to Neil Shah, co-founder of Counterpoint Research, Apple will need to raise its prices by an average of at least 30% to offset import duties.

A potentially sharp rise in prices could lower demand for the smartphone and give South Korea’s Samsung Electronics an advantage, as the Asian country faces lower tariffs than China, where all iPhones sold in the US are manufactured.

“Our quick calculations for Trump’s ‘Liberation Day’ tariff show that it could undermine Apple, potentially costing the company up to $40 billion,” said Crockett of Rosenblatt Securities, adding that negotiations between Apple, China and the White House are possible.

“We find it hard to imagine that Trump would undermine an American icon… but it looks pretty difficult,” he noted.

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