Apple may soon raise iPhone prices across the globe in response to a newly imposed 25% import tariff by former President Donald Trump. The tariff specifically targets products not manufactured in the U.S. and could impact Apple’s pricing strategy just before the iPhone 17 launch.
Analysts at Morgan Stanley believe Apple will absorb the tariff costs by raising prices by 4% to 6% worldwide. This adjustment is meant to balance out the thinner profit margins from U.S. sales without moving production to the U.S.—a move they say would be far more expensive and complicated.
Why Manufacturing Won’t Move
Building iPhones in the U.S. could increase costs by as much as 35%, largely due to higher labor costs and tariffs on imported parts. Morgan Stanley points out that even Taiwan Semiconductor Manufacturing Company (TSMC) needed four years to make its Arizona chip plant fully operational. That timeline makes local iPhone production unlikely during Trump’s term.
Additionally, the U.S. lacks the skilled labor force and infrastructure needed for high-volume iPhone assembly. Apple would also face legal and financial challenges breaking existing supplier contracts overseas.
Alternative Strategies and Impacts
Instead of relocating production, Apple may shift some less critical products—like AirTags, the HomePod, or select Macs—to U.S. factories. This could help ease political pressure while maintaining global iPhone output.
While Apple could use this shift to negotiate reduced tariffs, Morgan Stanley estimates that the company’s tariff-related costs might soon surpass $900 million per quarter. Despite these risks, the investment firm has kept its stock target for Apple at $235.
For now, iPhone users worldwide may need to prepare for slightly higher prices—an indirect cost of escalating U.S. trade policies.
