CUPERTINO, Calif. — Apple’s iPhones have secured a temporary reprieve from President Donald Trump’s escalating tariff regime, with electronics like smartphones currently exempt from new levies, according to a report by CNN Business on Wednesday, August 27, 2025. The exemption, part of existing trade rules, means U.S. consumers are unlikely to see immediate price increases on iPhones despite recent tariff hikes targeting countries like China and India, where Apple manufactures most of its devices.
The White House’s latest trade moves, which include a 50% tariff on Indian imports and a 145% levy on Chinese goods, have rattled markets and raised fears of higher consumer prices. However, smartphones, including Apple’s iPhone 16 series, are shielded under current exemptions, alongside semiconductors critical to their production. “Apple is coming back to America,” Trump declared on Truth Social, praising the company’s $500 billion investment pledge in February 2025 to expand U.S. manufacturing, including a Texas factory for Mac components. Still, Apple CEO Tim Cook, speaking on a May 1 earnings call, cautioned that tariffs could cost the company $1.1 billion this quarter, hinting at potential future price pressures.
Apple has diversified its supply chain in recent years, with 20% of U.S.-bound iPhones now produced in India, per Counterpoint Research, while 80% still come from China, where Foxconn assembles most units. To mitigate tariff impacts, Apple airlifted 600 tons of iPhones roughly 1.5 million units from India to the U.S. in March, Reuters reported. Key factors in Apple’s tariff strategy include:
- Exemptions for smartphones and semiconductors under current rules.
- Increased production in India, with Foxconn’s Chennai plant running Sundays.
- A $500 billion U.S. investment to bolster domestic manufacturing.
Despite the exemption, analysts warn of future risks. “Tariffs are a challenge, but Apple’s margins and supply chain flexibility position it well,” Gene Munster of Deepwater Asset Management told CNN Business. However, if exemptions lapse or new tariffs target components, prices could rise, with UBS estimating a $350 hike for the iPhone 16 Pro Max. For now, consumers like Julia Baumann, a personal finance editor who bought a MacBook anticipating price surges, can breathe easier, but the tariff landscape remains uncertain as Apple prepares for its September iPhone 17 launch.
Source: CNN Business
