Podcast host Josh Holmes explains President Donald Trump's plans to go to social media to implement tariffs and weighs after discussing Elon Musk's remarks at the first cabinet meeting.
Some of President Donald Trump's tariff presidents came into effect Tuesday, including the latest collection of imports from China.
Imports from China, the leading producer of smartphones, its parts and other technologies, suffered an additional 10% tariff. It is based on a 10% collection of presidents, which had already been imposed on the country in early February.
President Donald Trump will sign a series of executive orders at the White House Oval Office on February 10th. (Andrew Harnik / Getty Images / Getty Images)
In addition to new tariffs on imports from China, the administration has implemented tariffs on imports from both Canada and Mexico, ending a one-month suspension of those taxes.
The move has raised questions about how consumer prices on new smartphones will be affected in the short term, particularly in the taxation that is placed on imports from China.
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The Consumer Technology Association says that around 78% of US smartphone imports come from China.
Ravi Sawhney, founder of RKS Design, said it is unlikely that Fox business consumers will “see” a marked price rise for smartphones during the immediate period of tariffs, explaining that “already existing stocks will not be affected by the market as most smartphone manufacturers plan their stock and pricing strategies a few months ago.”
He added that businesses “often absorb short-term increased costs, rather than quickly handing them over to consumers to stay competitive.”
Crowell Global Advisors Global Life Sciences Chairman Joseph Damond offered a similar perspective on short-term smartphone prices, saying consumers may not face hiking anytime soon.
The Samsung Electronics Co. Galaxy S24 Ultra smartphone will be on display at the Samsung Store in Seoul, South Korea on Friday, October 4th, 2024. Samsung is expected to report record revenue in the September quarter. (Seongjoon Cho/Bloomberg via Getty Images)
“If sellers believe that tariffs are temporary and are being used as negotiation tactics, they may not be able to raise prices immediately,” Scott Beyer, chairman of the John E. Walker School of Economics at Clemson University, told FOX Business. “However, if tariffs are considered permanent, businesses may wish to raise prices. If consumer demand is not too sensitive to price changes, much of the tariff is passed on to the consumer.”
Meanwhile, economist Michael Southernto suggested that tariffs “may have a moderate impact on smartphone prices in the near future.”
“The final set of Trump's tariffs from his first term largely exempts Apple iPhones, which are primarily assembled in China, but Wall Street could be different this time,” he said.
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According to Damond, smartphone prices could rise in the medium term, but producers could “take measures to move production to countries that are not affected by tariffs to mitigate the increase in long-term costs.
“If these tariffs remain, we may see a gradual increase in prices over the next few months,” Sawhney predicted in the long term as well. “Manufacturers either absorb higher production costs, shift their supply chains, or pass directly to consumers.”
He said that Fox business consumers could potentially see companies looking at “more aggressive proximity strategies” to boost production in countries such as Vietnam and India, as “flagship devices” would become more expensive, or “reduced promotions and trade incentives.”
Baier also showed that companies could pursue moving smartphone manufacturing sites from China as part of their long-term response to the country's tariffs.
“Even if some of the rare earth materials, semiconductors, batteries and other component parts were produced in China as long as they are worth it through other components and assemblies in other countries,” he predicted. “If a product is shipped to the US from another country, it may not be subject to charges despite some elements produced in China. US Customs and Border Protection assesses whether the goods have been converted sufficiently to avoid customs duties.”
According to Szanto, tariffs could lead to a trade war.
“One other thing to note is the growing military threat to Taiwan, the growing tensions between the hostile communists and China,” he said.
Globally, there were 1.24 billion smartphone shipments by manufacturers during 2024, according to a report by International Data Corporation.
Your iPhone will appear on the Apple Store in New York City on February 3, 2023. (Leonardo Munoz / Getty Images / Viewpress by Getty Images)
In the US, 91% of American adults owned smartphones in 2024, Pew Research Center found in a survey last year.
Trump says there will be tariffs on “outside” agricultural products that begin on April 2nd.
When Trump announced tariffs on Canada and Mexico and announced its first collection of China in February, the White House said it was asking three countries to take steps to curb drugs and stop illegal immigrants coming to the United States.
The president announced plans for additional fees for China late last month.
