The recently introduced tariffs by President Trump might lead to a potential increase in the iPhone 16e price by 43%, raising it from $599 to $856. A reputable analyst has indicated that other models could be even more expensive. Mark Gurman of Bloomberg has also shared his perspective on how Apple may be impacted — and he believes that some of the higher prices mentioned by others are inaccurate. “Absurd, irresponsible, clickbait. Just completely fabricated,” he stated in a post on X.
These tariffs, which will affect the iPhone due to the majority being manufactured in China, have already led analysts to report a projected 43% price hike. This would imply that a premium iPhone 16 Pro Max with the largest 1TB storage option could rise from its current price of $1,599 to $2,300 — if Apple decides to pass the entire cost increase onto consumers.
Before addressing the quoted figure of $3,500, Gurman’s insight, shared in his latest Power On newsletter, is as follows: “If the tariffs are fully implemented by April 9 as intended, Apple will face a significant choice: Will it absorb the tariff costs, urge suppliers to lower prices, transfer the expense to customers, or make additional changes to its supply chain? I suspect Apple will adopt a mix of all four strategies,” he asserts.
He further proposes that the approach will entail encouraging component manufacturers to reduce their costs, absorbing “a small portion of the expenses,” contemplating price changes, and making supply chain modifications to decrease the number of iPhones produced in China.
Interestingly, he notes that Apple has been stockpiling inventory in the U.S. specifically to mitigate the effects of the tariffs, as all iPhones already in the country would be exempt from these new tariffs. “This suggests Apple could theoretically delay adjustments until the next iPhones are released in September, if it chooses to do so,” he mentions. However, I doubt Apple will wait that long, for the very reason Gurman points out: “The main issue with that is that the company risks making the price increases the focus of the news — rather than its hardware advancements,” he states. I believe that if price hikes are imminent, they will occur sooner since the news about rising tariffs is already widespread, taking some blame away from Apple.
Meanwhile, Dan Ives from Wedbush, a well-regarded technology analyst, has warned that prices might escalate even further, suggesting a cost of $3,500 for producing the iPhone in the U.S. rather than China.
Speaking on Yahoo Finance’s Morning Brief, Ives shared his insights. He first mentioned that if iPhones were “built in the U.S., right off the bat, just under tariffs it’s over $2,000.” He added, “I believe after Memorial Day, it’s over $2,000. Because they can’t absorb it. We’re not talking about a 3 to 5% impact through the supply chain. They can’t handle a 50% hit. And it also depends on what exemptions we may see. That’s why this is, look, it’s a black swan event going back to $3,500.”
This last comment was emphasized in a note to investors where Ives stated, “50% China tariffs and 32% Taiwan tariffs would essentially create a shut-off valve for the US tech landscape, causing every electronic device to increase in price by 40%-50% for consumers. iPhones made in the US would cost $3,500 (compared to $1,000), and the AI Revolution trade would be significantly hindered by these puzzling tariffs that MUST be negotiated to realistic levels.”
That certainly sounds alarming. However, it’s important to note his reference to “exemptions.” It’s likely that such exemptions are central to the ongoing discussions between Apple and the government.
Ives does not elaborate on why he has focused on Memorial Day (May 26), but it may be that he believes Apple has enough inventory to last until then before the tariffs begin to take effect—assuming there are no exemptions.
MacRumors has reported on the inventory situation, stating, “Trump announced that he would implement tariffs, and tech companies like Apple were aware that this was coming. It’s likely that Apple has been increasing its U.S. supply of current devices to temporarily avoid raising prices. According to the tariff executive order, Apple won’t have to pay tariffs on goods that are on a vessel and in transit to their destination before 12:01 a.m. Eastern Time on April 9, giving the company a few more days to stock up as much as possible.”
It’s also worth mentioning that other analysts have differing opinions. Reuters reports that Angelo Zino at CFRA Research believes the company will not pass on more than 5% to 10% of the cost.
“We expect Apple to delay any significant price increases on phones until this fall when its iPhone 17 is scheduled to launch, as this is typically how they manage planned price hikes,” he said.
Moreover, there are indications that Apple could take measures to mitigate the impact of the tariffs. For instance, the company could seek exemptions for specific components, which would likely need to come from the President directly. Additionally, Apple could relocate production to other countries where the new tariffs are lower than in China. Apple’s iPhone 16 Pro Max Price Shock: Post-Memorial Day Spike?