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Trump on Thursday announced the U.S. will put a 10 percent tariff on $300 billion worth of Chinese goods beginning Sept. 1, and according to Dan Ives, a managing director at the financial services and investment firm Wedbush, the new tax could hit Apple hard.
"While many U.S. companies are impacted by this latest trade tension, the 'poster child' for the US/China UFC trade battle continues to be Apple in the eyes of the Street with fears running rampant that these latest tariffs could significantly increase the cost of iPhones globally," Ives wrote, adding that demand could fall by about 6 million to 8 million units in the U.S. alone if the full 10 percent cost increase is passed on to consumers. Apple's newest model, the iPhone Xs, which currently costs $999, would cost an extra $100 under that scenario.
That would be another blow to Apple, which has been rapidly losing ground in China to rival Huawei. Earlier this week, a new analysis from the research firm Canalys found shipments in the country fell by 14 percent versus a year ago as the U.S.-China trade battle reached new heights.
Apple tried to get out ahead of an escalation in the trade war. In June, the tech giant wrote a letter to U.S. Trade Representative Robert Lighthizer, urging him to reconsider implementing more tariffs on Chinese goods. The company argued new tariffs would impact production of iPhones and MacBooks, most of which are manufactured in China, and all of its other major products.
"U.S. tariffs on Apple’s products would result in a reduction of Apple’s U.S. economic contribution,” the company said in its letter. “U.S. tariffs would also weigh on Apple’s global competitiveness.”
But, Trump rebuffed Apple's attempts for tariff relief, instead offering a simple solution.
"Apple will not be given Tariff waiver, or relief, for Mac Pro parts that are made in China," the president tweeted last week. "Make them in the USA, no Tariffs!"
Trump reiterated his stance at Thursday night's rally in Cincinnati, Ohio, suggesting any company wanting to avoid tariffs to "Make your product in America, come on back to the United States."