Apple has received assurances that the U.S. government will not place import tariffs on iPhones manufactured in China amid an escalating trade conflict between the two nations, according to a report Monday.
The Trump administration told Apple CEO Tim Cook that the tech giant’s flagship product will not be impacted, even as Trump ordered tariffs on an additional $200 billion worth of Chinese goods, the New York Times reported, citing a person familiar with the matter. However, Apple is said to be concerned that China will enact other policies that could hurt its business, including closer scrutiny of its products or efforts to delay its supply chain.
Apple shares fell more than 1.5% in trading Tuesday, outpacing declines in the Dow Jones Industrial Average and the S&P 500. Apple representatives did not immediately respond to a request for comment on the report.
Peter Navarro, the White House National Trade Council Director, told reporters Monday that he had “no knowledge or comment” on whether Cook had received assurances that iPhones would be exempt from the tariffs, Fox News reported.
Apple reported more than $13 billion in sales in China in its most recent quarter, up 21% year-over-year. Most of Apple’s parts suppliers for the iPhone are based in China.
Cook downplayed concerns about U.S.-China trade relations during an earnings call last month, noting that the iPhone was “the most popular smartphone in all of China” in the second quarter.
“I’m a big believer that both countries can win and grow the pie together,” Cook said.