Trump advisor says no intention to harm Apple with tariffs

Kevin Hassett, Director of the National Economic Council, said on May 27, 2025 that the Trump administration does not intend to harm Apple with tariffs.

Hassett said, “We don’t want to harm Apple,” in response to concerns about potential impacts on the company.

Hassett’s comments came after President Donald Trump suggested on social media that iPhones made outside the United States could face tariffs of 25% or more.

Apple has consistently produced its devices in countries such as China, India, and Vietnam.

🔗 Source: CNBC

🧠 Food for thought

1️⃣ The economics of reshoring create challenging tradeoffs for consumers and companies

Shifting iPhone production to the U.S. would significantly impact pricing, with analysts estimating U.S.-made iPhones could cost consumers between $1,500 and $3,500, potentially tripling current prices1.

This dramatic increase reflects the substantial cost gap between manufacturing in Asia versus domestically, driven by differences in labor costs, supply chain infrastructure, and economies of scale2.

The manufacturing reality mirrors broader trends in U.S. manufacturing, which has seen output increase while employment declined from 14% of the workforce in 1996 to approximately 8% in 20163.

Apple’s predicament highlights the complex economic tradeoffs in reshoring, gaining domestic production while potentially pricing products beyond what many consumers can afford.

The manufacturing math also explains why most consumer electronics companies have concentrated production in Asia despite years of political pressure to manufacture domestically.

2️⃣ Tariff patterns show large corporations often navigate trade policies more successfully than smaller businesses

Historical evidence from previous tariff implementations shows uneven impacts across the business landscape, with Apple previously receiving special exemptions from tariffs shortly after CEO Tim Cook met with President Trump in 20184.

While Apple secured relief for products like the Apple Watch, smaller businesses faced severe consequences. For example, Mid Continent Nail Corp. lost 200 employees and experienced 25% cost increases due to tariffs4.

The electronics manufacturing sector was particularly hard hit by previous tariffs, with over 1,300 products initially targeted, leading to significant price increases and supply chain disruptions for companies without Apple’s political connections5.