US President Donald Trump has sent across a tweet to Apple indicating that it will be beneficial for the company to move its manufacturing plant to America. The tweet suggested that by doing this, the Cupertino based technology giant can avoid tariffs in the on-going trade dispute between United States and China. This comes right after reports of the price of Apple products going up surfaced.
The Trump administration in United States this summer started imposing a series of tariffs on goods that are made in China. However, till now, consumer electronics were not one among these items. This is set to change however, as there is a fair possibility that the latest proposed round of tariffs will include products from technology companies like FitBit, Apple and Sonos.
Last week, Apple had said in a statement that these tariffs would result in a 25% tax on its products that are shipped to the United States including Apple Watch, Apple Pencil, AirPods, HomePod, Mac Mini, etc. The company further said that this would mean an increase in the price of these products — as the cost will be passed to the customers.
It was right after this that the world woke up to US President Donald Trump’s tweet urging Apple to build new manufacturing plants in America. He further said that this could mean no tax and relocating would bring with itself other tax incentives.
It is notable that Apple assembles a number of its products in China. US President Donald Trump has been quoted saying earlier that Apple CEO Tim Cook has committed to building “three big plants, beautiful plants” in the United States. The company itself has also said that it will be investing hundreds of billions in domestic manufacturing will be hiring more workers for the same.
Moving manufacturing to United States may help Apple skip the tariffs, but the company’s products are not very likely to get any cheaper. The reason for this is that workforce in China is cheaper and plants producing individual components are situated closely to each other. So moving its manufacturing plant to US would only prove to be more costly for Apple.