Trump says Apple will soon announce plans to build a new factory in Texas

Trump says Apple will soon announce plans to build a new factory in Texas
Stop us if you've heard this before. According to Reuters, President Donald Trump said that Apple will follow his wishes by opening a U.S. factory in Texas. The president's comments were made the same day that he disseminated a tweet saying that he would not grant the tech giant a waiver that would prevent it from having to pay import taxes on parts for the Mac Pro imported from China. Trump also pointed out that if Apple made the parts in the states, it wouldn't face tariffs on them. While Apple designs its products in the U.S., many of them are actually manufactured in China. Even though there is a "truce" in the trade war between the U.S. and China, the already announced tariffs remain in place.

You might remember that in July 2017, Trump said that he was told by Apple CEO Tim Cook that the company was building "three big plants, beautiful plants." The only problem with that comment was that it was not true. Apple later denied that any such conversation took place and said that it certainly did not have plans to build any factories in the U.S.

Trump has had a love-hate relationship with Apple, calling for a boycott of the company back in February 2016. Apple had refused a court order to unlock the iPhone 5c that belonged to San Bernardino shooter Syed Farook. Apple refused to do so because it would have required that the company develop a special operating system for the government; Apple was afraid that the software could get into the wrong hands making all iPhones vulnerable to getting hacked. Trump threatened to stop using his iPhone and said that he would use a Samsung handset until Apple gave the FBI what it wanted. An unnamed Apple executive responded by saying, "Trump’s call for (an) Apple boycott puts the company in standing with other good people he has criticized."

Tariffs are taxes paid by corporations and in many cases, they passed on to consumers


In June of 2018, The New York Times reported that Trump had promised Cook that the iPhone would not be subject to any tariffs. Economist and Trump advisor Peter Navarro denied that this promise was made. And while Apple's most important product has not yet been hit with tariffs, if the current truce doesn't hold up, the next tier of products from China to receive an import tax is said to include smartphones like the iPhone. According to Morgan Stanley analyst Katy Huberty, tariffs could add $160 to the price of the iPhone XR. That would raise the retail price of the 64GB model from $749 to $909. Last month, Apple tried to warn the president that tariffs on the iPhone could damage the U.S. economy.


Some of you might be surprised to learn that the tariffs are actually an import tax paid by consumers. In May, President Trump incorrectly tweeted that "tariffs are NOW being paid to the United States by China of 25% on Billions of Dollars worth of goods and services. These massive payments go directly to the Treasury of the U.S." Either Trump doesn't know how tariffs work, or the president purposely tried to mislead the country. China does not pay one cent of the tariffs. They are taxes paid by U.S. corporations that can eat them, or pass them along to U.S. consumers by raising prices. Apple, to its credit, has eaten the tariffs imposed on certain iPhone and iPad cases in order to keep the cost to consumers the same. This lowers Apple's profit margin on those products. So if a tariff is imposed on the iPhone, either Apple will be negatively impacted, or U.S. consumers will be in the form of higher prices for the device.


Meanwhile, we wouldn't be holding our breath waiting for Apple to announce a new plant in Texas. It is likely to be found next to the three non-existent factories that Trump said Apple was going to build two years ago.

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23 Comments

1. jellmoo

Posts: 2625; Member since: Oct 31, 2011

I'm not sure what's worse, the fact that Trump doesn't know how tariffs work, or that he doesn't understand why manufacturers choose to make their products in low cost centers...

2. darkkjedii

Posts: 31310; Member since: Feb 05, 2011

Another lie by Dump. He'll go on to say he never actually said it, like he said about Mexico paying for the wall.

3. Subie

Posts: 2390; Member since: Aug 01, 2015

Only one? Didn't Trump originally say that it would be 3 big big big plants - Beautiful plants...? Wasn't that what Tim Apple promised him?

5. cmdacos

Posts: 4264; Member since: Nov 01, 2016

Bigly

4. User123456789

Posts: 1008; Member since: Feb 22, 2019

Of course if Foxconn cant make iphones in China, they will move to another factory somewhere else. No way Apple will make stuff in USA.

6. Mike88

Posts: 437; Member since: Mar 05, 2019

He is doing the same what govts in Russia, China, India, Iran etc do to fool their people. They all pretend to fight but are working together in a common mission to stay in power until the big planned War can take place. They think after the war only the people they wish to exist will exist but I would say - not gonna happen. World will change sooner than they ever expected.

9. AbhiD

Posts: 850; Member since: Apr 06, 2012

You are in absolutely another level of delusion. Get well soon bruh... , God Bless Ya!

12. TheOracle1

Posts: 2340; Member since: May 04, 2015

I feel sorry for you. Was that from the latest Alex Jones episode?

24. tedkord

Posts: 17414; Member since: Jun 17, 2009

Yep. They are training the kidnapped children on Mars to be soldiers

14. mackan84

Posts: 555; Member since: Feb 13, 2014

Wow, you must be the hero in your dreams.

7. rossy

Posts: 42; Member since: Aug 23, 2013

Another TDS article by Alan. FYI, tariffs are not entirely paid by consumers or corporations. If they were, our inflation would rise and/or corporate profits would plummet by now. That has not been the case. Tariffs have been partially offset by renegotiating suppliers' contracts and currency devaluation. Strong dollar and weak yuang offset the cost of imports. I just wish that for once you stuck to the facts and not your opinion.

11. mootu

Posts: 1530; Member since: Mar 16, 2017

That doesn't alter the fact the consumers are paying the tariffs. When the yuang is weak like at the moment products would normally drop in price, that hasn't happened and in some cases prices have risen due to the tariffs.

13. TheOracle1

Posts: 2340; Member since: May 04, 2015

Tell that nonsensical drivel to the farmers who have to buy more expensive plant and machinery because of higher steel tariffs. That would be classified as an indirect extra cost which your kindergarten economics conveniently overlooks.

15. Alan01

Posts: 627; Member since: Mar 21, 2012

The things you cite, forex trends etc. are NOT part of tariffs. These could help alleviate some of the effects but forex is freely traded and buyers-sellers decide the trends. I understand that you want to support Trump but facts matter. The tariffs negatively impact the US economy. And what you wrote is also not true. The current forex trends are a coincidence. Nice try. Regards, Alan

16. rossy

Posts: 42; Member since: Aug 23, 2013

I wrote that the cost of tariffs are offset by other factors I listed. Trump is not correct by saying all costs are paid by China, but he is not entirely wrong. Some costs are paid by Chineese suppliers and offset by forex. If all tariffs are passed to consumers, our core inflation would be running 3% or higher. All I am asking you is to provide compete information in your long article.

19. Alan01

Posts: 627; Member since: Mar 21, 2012

Ok, here is the problem with your analysis. Forex rates are not guaranteed. So they are not officially part of the tariffs. And what costs are paid by Chinese suppliers? Any suppliers that agree to do something like that are doing so on their own. These are not official "parts" of the tariff. The tariffs are an import tax that in this case are paid for by U.S. corporations. The latter can eat the costs or pass them on to consumers. End of story. What you are doing is saying, well some Chinese suppliers are paying some of the tariffs to their customers, and forex rates are also helping. You are spinning the truth. The tariffs are a tax, they drag down the U.S. economy and the government of China does not pay one red cent (so to speak) to the U.S. to cover the cost of the tariffs. Remember, facts matter. Regards, Alan

23. rossy

Posts: 42; Member since: Aug 23, 2013

I agree that Forex is not guaranteed, but it is not accidental. US tariffs is one of the major factors negatively affecting Chinese economy thus prompting central government to pump money into their economy to stimulate it. They sell dollar from foreign reserves to buy yuan or simply print money. Increased money supply lowers the value of yuan. Until their economy recovers, they will probably continue doing that. I also stated that the factors listed in my earlier posts are offsetting the cost of tariffs. I agree that they're not part of tariffs. But this argument is moot. Consumer cares only about the cost it pays. He does not know or care what part of the cost is tariff. If the cost of the retail product went from $10 to $10.50 (due to 25% tariff on imported Chinese goods) and it's still affordable, the consumer will still buy it. Bloomberg just reported that consumer prices rose 1.6% vs. est. 1.7% in the month of June. This is below of what Fed Reserve wants (2%-2.5%). Consumer saving and spending is robust. Tariffs without offsetting factors, would affect consumer prices in a much meaningful way considering the amount of products we buy from China. Slightly off topic, your closing comments "nice try" and "remember, facts matter" come off as condescending, petty, and immature. If your think your arguments are strong, you should should close your post right after you state them.

17. rossy

Posts: 42; Member since: Aug 23, 2013

To add to what I wrote, Chineese currency weakness is not a cooinsidense. Chinese government has been pumping money into their economy, specifically government owned enterprises. It has been in the news (CNBC, Bloomberg) for months now. I am not a fan of tariffs, but I am a fan of fair trade without subsidies and tariffs. However, until that time, I will give Trump's administration a chance to negotiate better trade deals where tariffs are used as a leverage. If there are better ideas to get fair deal with China than tariffs, I would like to hear them.

8. joey18

Posts: 668; Member since: Jul 20, 2010

more spenced products outdated apple is failing iphone 11 apple last phone

20. vgking9699

Posts: 194; Member since: Mar 01, 2019

By the time a factory as big as one needed to make iPhones in the hundreds of millions that Apple typically sells yearly, so much time would have passed that trump would no longer be president so Apple wouldn’t have a reason to give a f**k what trump says

21. TBomb

Posts: 1572; Member since: Dec 28, 2012

Doesn't mean that bringing a factory Stateside would be a bad idea. Who knows what the geopolitical climate will be 1 year, 5 years, 10 years from now.

22. FLOGROWN

Posts: 58; Member since: Oct 25, 2018

Fandroids be like: Apple playing catch-up again SS have a factory up and running for years

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