President Donald Trump’s attempt to pull the manufacture of Apple’s iPhone to the United States faces many legal and economic challenges, according to experts, the slightest of which is the insertion of “small screws” that would need to be automated.
Trump threatened this Friday with imposing a 25% tariff on Apple for any iPhone sold, but not manufactured in the United States, as part of its administration to recover jobs.
Later this Friday he told reporters that the 25% tariff would also apply to Samsung and other smartphone manufacturers. He hopes that tariffs enter into force at the end of June.
“Otherwise, it would not be fair” that would not apply to all imported smartphones, Trump said. “I had an agreement with Tim Cook (Apple executive director) that I wouldn’t do this. He said he went to India to build plants. I told him that it was fine to go to India, but that they would not sell here without tariffs.”
The Secretary of Commerce, Howard Lutnick, told CBS last month that the work of “millions and millions of human beings screwing small screws to make iPhones” would arrive in the United States and would be automated, creating jobs for qualified workers as mechanics and electricians.
But then he told CNBC that Cook told him that doing so requires technology that is not yet available.
Lee: Apple shares fall while Trump threatens 25% tariffs unless the iPhones are manufactured in the US
“He said: ‘I need robotics, right? Do it on a scale and with a precision that allow me to bring them here. And the day I see them available, I will bring them here,” Lutnick said.
The fastest way for the Trump administration to press Apple through tariffs would be to use the same legal mechanism behind punitive tariffs on a wide strip of imports, they said commercial lawyers and teachers.
The legislation, known as the Law of International Emergency Economic Powers, allows the President to take economic measures after declaring an emergency that constitutes an unusual and extraordinary threat to the United States.
“There is no clear legal authority that allows specific rates for each company, but the Trump administration could try to introduce them under their emergency powers,” said Sally Stewart Laing, Akin Gump’s partner in Washington.
Other means to impose specific tariffs on companies depend on long investigations, Laing said.
But tariffs only for Apple “would give a competitive advantage for other important phones, which undermines Trump’s objectives to bring manufacturing to the United States,” Liang said.
Experts said Trump has seen the law mentioned as a flexible and powerful economic tool because it is not clear that the courts have the power to review the president’s response to a declared emergency.
“In the opinion of the Administration, while the ritual of declaring an emergency is promulgated and declared it unusual or extraordinary, there is nothing that a court can do,” said Tim Meyer, a professor of international law at Duke University.
In a case presented by 12 states that challenge Trump’s “Day of Liberation Day” in the International Trade Court based in Manhattan, the Court is considering that issue and if the IEEPA authorizes or not the tariffs.
Lee: Trump threatens Apple to impose 25% tariffs if it does not manufacture the iPhone in the US
If the Trump administration gains that case, “the president will have no problem in presenting an emergency as justification to impose tariffs on Apple iPhone imports,” said Meyer.
Trump could even simply include iPhones under the emergence of commercial deficit that already formed the basis of the tariffs declared previously, Meyer said.
They foresee more expensive iPhones
But moving production to the United States could take up to a decade and could result in the iPhones costing $ 3,500 each, according to Dan Ives, Wedbush analyst, in a research note. Apple’s high -end iPhone is currently sold for about $ 1,200.
“We believe that the concept that Apple produces iPhones in the United States is a fairy tale that is not viable,” said Iives.
Even without going so far, an iPhones tariff would increase costs for consumers by complicating Apple’s supply chain, said Brett House, economics professor at Columbia.
“None of this is positive for US consumers,” he said.
With Reuters information
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