President Trump announced this week a series of tariffs imposed on the import of products from other countries, which will end up hitting many US companies like Apple – since most of its products come from China. Now it seems that Apple is considering expanding the assembly of iPhones in Brazil to get around the US tariffs.
Apple to assemble more iPhones in Brazil
Sources familiar with the matter told Brazilian magazine Exame that Apple has been considering expanding the capacity of its facilities in Brazil as a way of paying lower import duties on iPhones.
Apple has been assembling products in Brazil since 2011. The company built a facility in São Paulo in partnership with Taiwanese company Foxconn. However, due to its small capacity, only a few products are assembled in Brazil, such as entry-level iPhones, to supply the local market. According to the report, Apple wants to assemble even more iPhone models in Brazil in the near future.
“The possibility of expanding manufacturing in Brazil began to be studied last year, with upgrades to machinery and industrial processes,” says the report.
Anatel, the Brazilian telecom regulator, recently granted Apple and Foxconn Brazil the necessary certification to assemble the iPhone 16 in Brazil. The iPhone 13, iPhone 14 and iPhone 15 were already assembled in the country. The report suggests that Apple also wants to assemble iPhone 16 Pro models for the first time in Brazil.
Top comment by Expert (Retired)
It is super important for every article about these tariffs to explain what the administration did. They did put a tariff on a good equal to what that country charges us. Most of those tariffs are quite low- in the single digits.
This lunatic administration took the trade deficit between the two countries, and used that as a basis for a tariff.
So the US buys $200 million from Country A. Country A buys just $100 million from the US. That's a 50% difference. Divide that by two, and you get a 25% tariff.
So little Lesotho- landlocked country in Southern Africa- one of the poorest countries on the planet has a $200 million dollar trade deficit with the US. We buy diamonds and textiles. Not sure what they buy, but in a country where the average income is about $1000 a year, how much could we possibly expect their 2.25 million people to buy from the United States?
They were hit with an absolutely insane 50% tariff. Leaders there say that will basically kill one of their biggest industries- textiles. Levis and Calvin Klein are big customers, but they will just move production to someplace else- not the US, just a country where the tariff is maybe just 10%. And Lesotho? It just becomes even poorer.
If Apple succeeds, iPhones assembled in Brazil will not only meet local demand, but will also be exported to the US. For Apple, this will result in considerably lower taxes.
The US government will tax products imported from China by 34%. India, which also assembles iPhones exported to the rest of the world, has been slapped with a 26% tariff. For Brazil, Trump’s tariffs are only 10%. The president claims that the tariffs are “reciprocal” to what each country already charges on products imported from the US.
Apple’s shares have already plunged by more than 10% since the new tariffs were announced. The company has lost $300 billion in market value so far. The same has happened to other US companies such as Nvidia. The announcement has already pushed Nintendo to hold off on launching the Switch 2 in the US, citing uncertainties over tariffs.
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