After the Trump administration threatened to impose a 54% tax on imports from China (with a further 50% increase looming after China retaliated with higher import taxes on the US), Apple’s stocks took a heavy hit. However, this also led to a frenzy of American consumers flocking to buy iPhones at Apple Stores nationwide last week.
The reason being, they feared that iPhone prices would skyrocket soon. Employees reported that the atmosphere in the stores was akin to a holiday season, with customers rushing in and asking in unison, “When will iPhone prices go up?”
Apple is currently scrambling to deal with the situation, as reported by The Wall Street Journal, the company is expediting the import of iPhones from India to the US in large quantities. They are also shifting production lines to India and Vietnam, as well as stockpiling products in advance.
While sales may be on the rise, Apple’s market value has plummeted by over $500 billion within just two days, the heaviest drop since the dot-com bubble. It is expected that Apple will address this issue further at the shareholders’ meeting on May 1.
Source: Bloomberg
TLDR: The Trump administration’s threats on import taxes from China have caused Apple’s stocks to drop, leading to a rush of American consumers buying iPhones out of fear of price increases. Apple is taking steps to mitigate the situation by sourcing iPhones from India and restructuring production lines. Despite increased sales, Apple’s market value has decreased significantly.
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