- A federal court has said that the Trump admin doesn't have authority to set tariffs, a ruling that was almost immediately reversed by an appeals court
- Meanwhile, analysts say that if Apple tariffs do go ahead they would be best off eating them
- It would take several years to even bring final assembly back to the states
UPDATED 5:00 PM: An appeals court temporarily reinstated the Trump tariffs on Thursday afternoon.
The Trump administration tariffs are up in the air right now, just as analysts tell Fierce Network that Apple — which has been threatened with 25% tariffs by Trump — would take years to bring their iPhone manufacturing home.
A three-judge panel of the United States Court of International Trade Wednesday night unanimously found that the International Emergency Economic Powers Act of 1977 — which Trump used to unilaterally enact duties on foreign goods — does not authorize the tariffs and ordered them stopped. The court noted that only Congress has the authority to regulate trade with foreign nations. The Trump administration immediately filed an appeal after the ruling.
An appeals court almost immediately temporarily reinstated the tariffs on Thursday afternoon.
The S&P 500 and Nasdaq have climbed on the news. The markets and industry will, however, be waiting to see what will happens next with the tariffs.
Apple Trump tariff turmoil
Before the recent tariff ban, Trump had threatened Apple with a 25% tariff on iPhones made outside of the United States. Analysts told Fierce that it would take years for Apple to bring parts of the manufacturing process back to the U.S. and moving the manufacturing stateside would raise prices anyway.
“Apple absolutely could bring final assembly to the U.S.,” Avi Greengart, president of Techsponential told Fierce in an email. However he said, “It would take at least two to three years to spin up, it wouldn't be able to manage the volumes that Apple needs, and it wouldn't be profitable to do it. You would also need to import or spend years training manufacturing engineers and managers.”
“However, even that is just final assembly; the components that go into an iPhone are part of a global supply chain,” Greengart said. He noted that the housing and batteries come from China, the displays from South Korea, while the processor comes from Taiwan.
“From a business perspective it would be more economical to eat or pass along the tariff,” Geengart said.
“Making iPhones in the US could be as just as expensive, if not more so, than passing the 25% tariff onto consumers,” agreed Recon Analytics analyst Daryl Schoolar. “If I was in Apple’s place I would just be patient and try to engage the administration. Trump has changed his tariff position so often that there is a reasonable chance he will lower or remove tariffs on Apple’s iPhones altogether in a few weeks.”
Indeed, now with the federal court ban of Trump’s “Liberation Day” tariffs, everything is up in the air. We will have to wait and see how the administration's appeal of the court ruling plays out.