Apple mulls more India-made iPhones for US to avoid China tariffs: Report

Apple shares witnessed the worst 3-day performance in 25 years as it slipped 19 percent

Apple is planning to export more iPhones from India to the US to beat the tariffs imposed on China, the Wall Street Journal has reported.

The Cupertino-based tech major is looking to implement the plan as a temporary measure to offset the high cost of imports due to the tariffs imposed on Beijing, the American daily said.

Last week, US President Donald Trump announced a 34 percent tariff on Chinese goods in addition to a 20 percent duty implemented earlier. Beijing retaliated with a 34 percent tariff on US goods imported to the Asian nation, escalating an already chaotic global trade situation.

In response, Trump on April 7 warned of 50 percent more tariffs if Beijing does not back down.

Washington has announced a 26 percent tariff on India, lower compared to its Asian peers, making it cheaper for Apple and others to export goods from here.

But it won’t be easy. iPhone, the flagship product of Apple, makes for around 50 percent of the company’s revenue, WSJ said. The manufacturing supply chain of the smartphone is heavily dependent on China due to which the investors are worried, the report said.

In the past three days, Apple shares have slipped more than 19 percent, making it the worst three-day performance for the phone maker in almost 25 years, the report said.

Tariffs on Chinese goods could add up to $300 on iPhone’s hardware cost, which is currently $550. The phone’s retail cost is $1,100, according to WSJ.

In India, Foxconn and Tata group manufacture iPhones for Apple. They will have to expand their supply chain if Apple wants to ship more phones to the US.