The President of the United States, Donald Trump, makes new announcements from time to time which invariably affect the people in one way or the other. This time, he confirmed that his office will approve an increased tariff of 25 percent on all types of imported steel and a 10 percent tariff on imported aluminum products.
The announcement will have a deep impact on industrial products and manufacturers who rely on imported steel to make majority of their products. A surprising fact is that this increased tariff is going to have an impact in the world of technology as well – smartphones, to be precise.
Apple is known for the premium quality smartphones they make and such level of sophistication is achieved by using ample amount of steel and aluminum in their iPhones. The premium experience that you get when you hold an iPhone, the Apple Watch or the MacBook is made possible by generous use of these metals. As Trump has confirmed that the increased tariff bill will be passed next week, it’s going to have a subtle yet noticeable impact on the pricing of most Apple products.
Based on the research done by analysts, it has been confirmed that the Apple MacBook Pro 15-inch model consists of 740 grams of aluminum. The iPhone X which is their hottest selling model of the season has 58 grams of stainless steel. Using steel and glass in smartphones make it easier to dissipate heat while improving signal reception. Ever since the first iPhone was launched in 2007, Apple uses these materials to make their products premium and long-lasting.
In his statement, Trump was not clear about the tariff and whether they are applicable only to the raw materials. If it’s not going to apply to the final product, Apple’s cost to manufacture and sell goods may not vary at all. The bill will be signed next week and if it is confirmed that the increased tariff is applicable to finished products, Apple would increase its pricing by at least 0.2 percent or higher to cope up with manufacturing costs.
Apple is known for its tendency to increase costs in order to keep their profit margin high. The MacBook Pro and iPhones rely on imported aluminum, stainless steel materials. They will fall under the new tariff imposed by the U.S. government but with these products already being expensive, the increase in cost may not affect buyers on a substantial level.