Tax on iPhone: Apple and Big Tech at the doors of an “economic apocalypse”

$ 1,798 for an iPhone 16, $ 2,023 for a iPhone 16 Plusup to 3,918 dollars for an iPhone 16 Pro Max, these prices are dizzy and could soon come true, explains Daniel Ives, Global Head of Technology Research within the Wedbush analysis firm.

If Apple was the first to voluntarily cross the $ 1,000 to its smartphones, this potential price increase would be – will be? – Independent of the will of the Cupertino giant.

Apple, in the heart of the storm of the century

In accordance with his campaign promises, Donald Trump initiated an all -out trade war against his allies and supposedly commercial adversaries, China in mind. After having set the import taxes at 84 %, the 47th American president published a new presidential decree which takes these samples to 125 %… or a total of 145 %of customs duties applicable to Chinese imports on the UNITian soil, since it is necessary to add to the 125 %, the 20 %imposed on China within the framework of the fight against fentanyl.

However, for Daniel Ives, “Apple, which is at the heart of the storm, will not absorb $ 1,000 (additional cost) on each iPhone. It would be madness “. “Prices will therefore increase in the United States …”he predicts, before adding in the same breath, “And if prices increase it will not only be for us (the United States, editor's note)it will be for everyone, even in Europe. “

In the current state of things, the increase in prices is therefore inevitable, but when will it intervene? Has the point of no return have already been crossed? Is it close? On this point Daniel Ives is also quite categorical. “If current customs duties are maintained for a few more weeks, at most, Apple will have to increase its prices.”

For a Interactive version of this graph, click here.

A collapse in approach

And it is obvious that beyond the beautiful range of construction mechanics, with prices that overlap, overlap and encourage the consumer to opt for the upper model, these taxes will have the effect of a bomb.
“As soon as these prices set up, destruction of demand could be 40 to 50%”estimates Daniel Ives. This would be half of the purchases of iPhone that would evaporate. Recall that during its last tax quarter, the figures announced by Apple indicated that the iPhone represented almost 80 % of its income (69.138 billion dollars). And this is of course without counting on the fact that the other products manufactured by Apple in China will be subject to the same price increases. There Watch Series 10 would go from 399 to 978 dollars and the entry -level MacBook Air from 999 to 2,448 dollars…
“If this taxation policy continues, we will attend an economic apocalypse. »»warns Daniel Ives. “The goal is to bring China to the negotiating table”he continues. But, to get there, Donald Trump “Is breaking the legs of the Big Tech in the United States in the middle of the race”. The analyst, who apologized several times during our interview of not having a more positive vision of the situation explains: “I have been the tech sector for 25 years. I have never seen that. These taxes will certainly produce a recession. They are put in place without what they will produce being understood. »»he exasperates. “And that remains, and for a long time, the worst political error of the White House, in my opinion, for the past one hundred years. »»

The end of American leadership?

Such a reduction in the financial results of American giants will of course have an impact on all their activity. In a note published on April 11, 2025, Wedbush analysis firm wrote: “We estimate that 10 to 15% of many initiatives in the cloud and AI in the United States (…) could be slowed down or rejected in this period of uncertainty.“A slowdown in activity and innovation, but also of investments. “We think investors will start to watch the results after June (…) And that the uncertainty caused by taxes will repel a certain number of agreements and projects for the financial quarters of September and December, until the financial directors take better measure of the rules of the game. “

For Daniel Ives, no American and tech company is no longer exposed and harder than Apple. For the analyst, if the situation continues, “There will be only one winner La Tech Chinese”. And more hard and long will be affected by the “Mag 7” (the magnificent 7, name given to the American tech giants: Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia and Tesla), the more the impact on innovation, redemptions and the United States Leadership will be deep, durable. To the point, to downgrade the United States definitively …

Escape China? Escape?

Apple has already started to lighten its dependence on China, by moving part of its iPhone production in India. But for the time being, this represents only a few percent of the smartphones produced and if everything goes well, it will be necessary to wait 2028 for the Indian faxconn factories to weigh for 25 % of the iPhone products. “In the short term, the options are minimal”notes Daniel Ives. “India could produce 3 or even 4 % of iPhone, Vietnam could weigh for 2 % of this same production, but the vast majority will always be made in China”. Brazil is also a track because Foxconn built factories there several years ago, to get around local import taxes. Imports from the South American country are currently taxed at “only” 10 %.

Apple has put its logistics strategic in place over the decades of meticulous work and optimization of the supply, production and delivery of finished products, with little stock. A kind of liner whose trajectory is not changed with a snap of finger. For Daniel Ives, “” It is a boat that we returned in the middle of the ocean without a rescue canoe. “

An exit of the crisis could come from a negotiation of Tim Cook with Donald Trump so that his company avoids all or part of the taxes, but the Wedbush analyst sees a major problem with this solution: “No one knows the rules of the game”worse, no one can plan them, except perhaps the relatives of Donald Trump. “And even if Tim Cook succeeded, he cannot commit to producing the iPhone in the United States. It is impossible. It is a fairy tale …”

Bring the Jobs Back Home!

“Apple produces and assembles more than 90% of its iPhone in China”recalls Daniel Ives. And the solution which would consist in bringing jobs to the United States, which would also serve the Trumpian Maga project, is therefore improbable. “I am more likely to become NBA champion than the iPhone to be produced in the United States”Cingle Daniel Ives.

However, during his first mandate, Donald Trump had obtained that Tim Cook Rapatrie on national territory part of the production of Mac Pro. But it was a symbol more than anything else. If the Mac Pro is (theoretically) the most powerful Apple machine, its sales volumes, and therefore of production, represent nothing compared to those of iPhone.

However, in February 2011, already, the then president, Barack Obama, called Steve Jobs during a dinner. He asked him what it would take for the jobs related to the manufacture of his products to return to the United States. His words, reported by the New York Timeswere very clear: “These jobs will not come back”. And Tim Cook's point of view is no different. For what ? For reasons of responsiveness (to say things in a watered down) and massive skilled labor needs. An example, reported by the New York Timesalways, in the same article. In the final stretch before the production of an iPhone, Apple has made changes to its screen at the very last minute. The new slabs arrived at the assembly plant at midnight. A counter-master then immediately woke up 8,000 employees, who after eating a cookie and drank a tea, and in less than half an hour, started a day of work of twelve hours. In less than 96 hours, the factory produced 10,000 iPhone per day. Difficult for any country to align with these conditions, especially since for Daniel Ives, the entanglement of the Apple production chain with China and Asia has since believed.

But the question of labor is not the only problem. Returning these jobs in the United States would take time and would cost Apple a fortune. “The cost structure means that it is impossible.” he says, before detailing his remarks. “Apple should spend $ 30 billion in three years to move only 10% of its supply chain in the United States.” A mirobal cost for the American giant, whose deep pockets would be mistreated. But those of the United States would also suffer. “An American iPhone would cost $ 3,500”calculates Daniel Ives.

What solution then for Apple, and the Big Tech? How to avoid this apocalypse which could forever shake American domination in tech? “There is no solution. There is nothing that they can do. Their house is fire and blood from the inside”bitterly recognizes Daniel Ives. “Finally, there is only one solution. Trump”he lets go, before clarifying. “This taxation policy must stop, or the future that awaits us will be of the darkest.