Apple supplier warns US consumers will soon face “empty shelves” due to the tariffs
iPhone shoppers in the United States could face “empty shelves” within two months because of the tariffs, a key Apple supplier has warned.
Apple’s market value has already lost about $700 billion dollars because of the uncertainty surrounding the tariffs that the Trump administration imposed on Chinese goods. Unless the situation improves soon, consumers in the United States might face “empty shelves” this summer like some people in “third-world countries” do, Pegatron chairman T.H. Tung told Reuters.
“Within two months, shelves in the United States … might resemble those in third-world countries, where people visit department stores and markets only to find empty shelves, all because everyone is waiting and seeing,” Tung said.
Apple, China, iPhone and the tariff situation
While the Trump administration temporarily paused some tariffs, a ten-percent levy on nearly all goods imported into the United States remains. Importers have reduced foreign imports as they’re waiting to see whether that tariff will be repealed.
Pegatron, a contract manufacturer based in Taiwan that assembles the iPad, MacBook and Apple Watch models, previously expanded some of its manufacturing operations. However, the company will not change its plans even if the latest tariffs have threatened to disrupt global supply chains.
“Just because Trump raises tariffs doesn’t mean the rest of the world will do the same. Taiwanese contract manufacturers are sticking to their overseas plans,” he said. “We won’t immediately adjust our long-term plans just because of two or three months of tariff changes. Manufacturing bases require long-term planning.”
Apple’s boss Tim Cook has secured a temporary exemption for iPhones, Macs, Apple Watches and iPads, similar to a tariff exemption he negotiated in 2019 for Mac Pro parts with the first Trump administration.
Apple has been diversifying its manufacturing locations
The Trump administration imposed a baseline 145 percent tariff on imports from China, where the vast majority of world production takes place. Apple is particularly vulnerable to an ongoing trade war between the United States and China, as most of its suppliers and assemblers like Foxconn are from China.
For years, Apple’s leadership has been trying to move some of the production to other countries like Vietnam, Indonesia and India. The problem is, no other country has invested that much into production capacity as China.
For example, Foxconn assembles iPhones in a manufacturing facility located in the Chinese city of Zhengzhou, referred to as “iPhone City.” Many companies supplying parts to Apple are located in the same area, and labor is cheap in China, simplifying logistical and production challenges for companies like Apple.
A recent report by The Financial Times says Apple wants to double its iPhone production capacity in India to produce all US-bound iPhones there by the end of 2026. IDC estimates that the US market accounts for about 28 percent of global iPhone shipments, meaning more than one in every four iPhones is sold domestically.
Source link: https://www.idownloadblog.com/2025/04/29/apple-tariffs-pegatron-production-chairman-empty-shelves-comment/
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