White House economic adviser Kevin Hassett sidestepped a question on Tuesday about President Donald Trump’s tariff threats against Apple iPhones.
Trump threatened Apple with 25% tariffs unless the company starts making their iPhones in the United States. His threat came after Apple CEO Tim Cook said the company would continue manufacturing phones in India to avoid expensive prices for Americans.
CNBC “Squawk Box” host Joe Kernen noted on Tuesday that iPhones would cost about $3,500 if they were made and manufactured in the United States.
“What is Tim Cook supposed to do?” Kernen asked Hassett on Tuesday.
Hassett offered a shaky defense of Trump’s tariffs in his response.
“We’ll see how it works out,” Hassett said. “But the bottom line is that what we’re trying to do is onshore as much as we can in the US, and make it so that the US is not hyper dependent on imports from China.”
“If you look at the 20% equipment investment of the first quarter, before the tariffs even came in. You know, with supply chains moving fast and just in time, inventory management and AI, I think you’re going to be astonished at how quickly stuff moves on, and that’s what we’re shooting for,” Hassett continued.
“And in the interim, you know, that we’ll see how it works out, but they need to move their stuff onshore as much as possible to make it so that the US economy is secure and not prone to, you know, Chinese extortion,” he added.
“Squawk Box” co-anchor Andrew Ross Sorkin then asked if the Trump administration would consider giving a “reprieve” to Apple if the company outlines a long-term plan to move more manufacturing to the U.S.
“Because clearly, it’s, almost just from a physical standpoint, impossible to move everything overnight. And you know, the damage that you do to the company overnight is obviously tremendous,” Sorkin said.
Hassett dismissed concerns of the tariffs in his response. He also suggested that Apple, not consumers, would bear the brunt of the tariffs.
“So the point is that everybody is trying to make it seem like it’s a catastrophe if there’s a tiny little tariff on them right now, to try to negotiate down the tariffs. And so in the end, we’ll see what happens,” Hassett said. “In the end, we’ll see what happens, we’ll see what the update is, but we don’t want to harm Apple.”
“If you think that Apple has a factory some place that’s got a set number of iPhones that it produces and it needs to sell them no matter what, then Apple will bear those tariffs, not consumers, because it’s an elastic supply,” he added.
Trump’s tariffs against Europe had been preceded by a threat of import taxes against Apple for its plans to continue making its iPhone in Asia. Apple now joins Amazon, Walmart and other major U.S. companies in the White House’s crosshairs as they try to respond to the uncertainty and inflationary pressures unleashed by his tariffs.
“I have long ago informed Tim Cook of Apple that I expect their iPhone’s that will be sold in the United States of America will be manufactured and built in the United States, not India, or anyplace else,” Trump wrote. “If that is not the case, a Tariff of at least 25% must be paid by Apple to the U.S.”
Trump later clarified his post to say that all smartphones made abroad would be taxed and the tariffs could be coming as soon as the end of June.
The Associated Press contributed to this report.
Stories by Lauren Sforza
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