President Donald Trump announced plans to impose sweeping new tariffs, including a 25% levy on all non-U.S.-made iPhones and a 50% tariff on goods imported from the European Union starting June 1st. The threats, posted to social media, sent U.S. and European stock markets downward and triggered broader economic concerns. Trump framed the move as a response to stalled trade talks with the EU and ongoing frustration with tech companies outsourcing production.
The proposed iPhone tariff would apply to all imported models, significantly impacting Apple, which does not manufacture smartphones in the United States. Trump stated that Apple would be subject to the tariff unless it begins domestic production of iPhones. He emphasized that Samsung and other smartphone makers would also fall under the same rule. Analysts estimate the cost of an iPhone 16 could rise by up to $275 if the policy is enacted. Apple’s shares dropped by 3% following the announcement.
Trump also declared a 50% tariff on EU imports, arguing that the bloc maintains unfair trade practices and that negotiations have not progressed. Products affected would range from automobiles to pharmaceuticals, potentially raising prices on essential goods. The European Commission responded by reaffirming its commitment to mutual trade cooperation, while Dutch Prime Minister Dick Schoof called the tariffs a likely negotiation tactic.
Although Apple has committed to investing $500 billion in U.S. infrastructure over four years, it has not included iPhone production in its plans. Manufacturing constraints and lack of domestic smartphone production infrastructure make a rapid shift to U.S.-based assembly unlikely. According to U.S. Customs and Border Protection, all imports would be subject to new tariffs unless produced domestically, including under the Generalized System of Preferences.
The economic implications of the new tariffs could be significant. The EU exported roughly €500 billion to the U.S. last year, with key sectors including autos, chemicals, and electronics. A 50% tariff could disrupt international trade compliance, while also prompting retaliatory measures. Investors and policymakers continue to monitor the situation closely through agencies like The International Trade Administration.
