The US-China trade war is officially set to affect Apple as of this week. Bloomberg reports that at 12:01 a.m. ET on Sunday morning, Apple products such as Apple Watch, AirPods, HomePod and more will be hit with 15 percent tariffs.
Ecobee HomeKit Thermostat
The report explains that 15 percent of customs duties for another round of goods imported from China were entered into the federal register on Friday, making them official. There were threats from President Trump that tariffs could actually push as high as 30 percent, but the administration appears to have settled at 15 percent by now.
As for Apple, here is the complete list of products that will be included in this next round at 15 percent rates:
- Apple Watch and Watch band
- Some Beats- headphones
- iMac computers
Bloomberg also notes that repair of parts for iPhones "may also be affected, while flash storage components used in the iPhone" may also be affected. " The iPhone itself is spared from this tariff round, but will face a 15 percent penalty from December 15. At least this means that Apple will avoid an iPhone charge during the launch of the new iPhone 11. next month.
Analysts have predicted that Apple is likely to absorb the cost of tariffs, but it is not out of the question that Apple could raise any prices to help make up the 15 percent hit. Gene Munster, an analyst at Loup Ventures, explained that 15 percent tariffs on wearables such as Apple Watch and AirPods "are likely to reduce revenue by 5 cents to 10 cents per share per year."
Apple CEO Tim Cook has pushed back against President Trump's tariff plans. Cook had dinner with President Trump several weeks ago, claiming that it is unfair of Apple to pay tariffs, while Samsung does not. Trump said he found Cook's argument "compelling," but whether it will lead to any political change is unknown.
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