The White House is doubling down on its demand that Apple shift iPhone assembly to American soil, threatening a 25% tariff on every handset built overseas and sold in the United States. The move could push the retail price of a flagship iPhone past $3,000, triple today’s level. Analysts say even loyal U.S. consumers would balk.
💸 Sticker Shock
Wedbush Securities calculates that labor, logistics, and component markups needed to replicate Apple’s Asian supply chain in the U.S. would add roughly $2,500 to the cost of a top-tier iPhone.
“That translates to a $3,500 retail price,” the firm warned clients this week.
Meanwhile, Needham & Co. projects a 50% cost increase across Apple’s U.S. product line once tariffs are included. This would fuel inflation and disrupt supply chains across industries.
🔗 Supply-Chain Reality Check
Despite pledging another $100 billion investment in U.S. manufacturing (on top of the $500 billion already committed), Apple still assembles 90% of iPhones in China.
Each iPhone contains:
- 🧩 ~2,700 parts
- 🌍 Sourced from 187 suppliers in 28 countries
Re-creating even 10% of this ecosystem in the U.S. would:
- Cost $30 billion
- Take at least 3 years
🏭 What Apple Is Actually Doing
Apple is making incremental domestic moves:
- 🧪 All iPhone & Apple Watch cover glass is now made at Corning, Kentucky
- 🔧 U.S.-based chip work is expanding with Samsung, Texas
- 🧲 Rare-earth magnets are being sourced from domestic mines
However, CEO Tim Cook says final assembly will remain overseas. Most iPhones bound for the U.S. are now being built in India, not China.
📉 Market Reaction
Wall Street sees the tariff push as a lose-lose scenario:
- If Apple absorbs the cost, margins collapse
- If consumers bear the cost, unit sales crater
📉 Analysts predict:
- 📉 A 10–15% drop in annual iPhone revenue if prices rise above $2,000
- 💬 Wedbush warns, “A fully domestic iPhone is a non-starter for the mass market”
Even affluent Americans typically resist smartphones priced above $1,500.
⚠️ Bottom Line
Trump’s push may earn political points. But a $3,000 iPhone made in the USA risks pricing Apple out of its largest market. Unless the administration softens its tariff stance, Apple appears caught between a White House ultimatum and consumer sticker shock.
