Apple, Microsoft, Other Tech Brands Set To Smile As Trump Exempt Electronics From Latest Reciprocal Tariffs
Big tech firms like Apple, Microsoft, Nvidia and the brother tech industry can now breath a huge sigh of relief with the announcement that smartphones, computer monitors and various electronic parts have been exempted from President Donald Trump’s latest reciprocal tariffs. The decision was announced in a US Customs and Border Protection notice posted last Friday.
Howard Lutnick, the U.S. Commerce Secretary, however, said that the Tariff exemptions announced on electronics like smartphones and laptops are only a temporary reprieve until the Trump administration develops a new tariff approach specific to the semiconductor industry.
The exemption, which comes after the Trump administration imposed a minimum tariff rate of 145% on Chinese goods imported to the United States on Wednesday, does not include the 20% tariff on Chinese goods for the country’s role in the fentanyl trade. The tariff exemption would have a major impact on tech giants like Apple, which make iPhones and other products in China.
Roughly 90% of Apple’s iPhone production and assembly is based in China, according to Wedbush Securities’ estimates.
Analysts at Wedbush Securities on Saturday called the tariff exclusion, “The best news possible for tech investors.”
The White House said last Saturday that Trump will continue to urge tech companies to move production to the United States.
“President Trump has made it clear America cannot rely on China to manufacture critical technologies such as semiconductors, chips, smartphones, and laptops. That’s why the President has secured trillions of dollars in U.S. investments from the largest tech companies in the world, including Apple, (Taiwan Semiconductor Manufacturing Company), and Nvidia. At the direction of the President, these companies are hustling to onshore their manufacturing in the United States as soon as possible,” White House press secretary Karoline Leavitt said in a statement.
Economists have warned the cost of tariffs may ultimately be passed on to the consumer. That fear has sent many Americans rushing to buy big-ticket items, such as cars and electronics, as consumer sentiment has dropped to record lows.
Nintendo said on April 4 that it would postpone the US preorder date of its Switch 2 gaming console to “assess the potential impact of tariffs and evolving market conditions.” Initially priced at $450, the Switch 2 could instead cost around $600 as a result of tariffs, according to experts.
The Trump administration says these tariffs would bring more manufacturing jobs to the United States and reverse a decades-long decline. However, some products can’t be easily made or found in the United States, thus increasing the costs to produce them in American factories.
Semiconductors and microchips are among the products heavily outsourced to factories in Asia due to lower costs. Those electronic parts are now exempt, according to the Friday notice. That could help Asian chipmakers, such as Taiwan Semiconductor Manufacturing Company (TSMC), South Korea’s Samsung and SK Hynix.
“The president has stated that autos, steel, pharmaceuticals, chips and other specific materials will be included in specific tariffs to ensure tariffs are applied fairly and effectively,” a White House official said.