New iPhones are about to be unveiled, but tariffs could cut Apple's profits by $5 billion

Apple confirmed on the 29th that it will release new fall products on September 10. However, one of the most pressing issues facing Apple right now is the latest round of tariffs implemented by the Trump administration starting on September 1. If all the additional tariffs take effect, Apple's profits may shrink by at least $5 billion. 

On the 29th local time, Apple sent out invitations, confirming that it will hold a fall new product launch conference on September 10th . It is expected that the new iPhone will be officially unveiled. Apple, which is in a dilemma of sluggish growth, has to face new uncertainties: According to Reuters, the Office of the United States Trade Representative officially confirmed on the 28th local time that the tariffs on $300 billion worth of Chinese goods imported into the United States will be increased from 10% to 15% in batches starting from September 1st. The first batch of goods subject to a 15% tariff include smart watches, Bluetooth headsets, flat-screen TVs and a variety of footwear.

This means that Apple Watches, wireless headphones, etc. will be subject to a 15% tariff - while Apple products were hardly affected by the Trump administration's previous three rounds of tariffs.

CNBC reporter: Analysts estimate that this could cost Apple $500 million. If Apple tries to pass on the tariff costs to consumers by raising prices, this will of course bring the risk of reduced demand. Some analysts told me that they are more worried about the additional tariffs on Apple phones. The US government now plans to impose tariffs on mobile phones starting December 15. If Apple is hit by all these potential tariffs, its profits will be reduced by at least $5 billion.

CNBC believes that another possibility cannot be ruled out - that Apple successfully persuades the Trump administration to exempt the company's products from tariffs. Apple has always been one of Trump's favorite American companies.

In fact, when Trump announced a 10% tariff on $300 billion worth of Chinese goods, Apple CEO Cook had been " thinking of a solution . "

Cook has approached Trump several times to express his dissatisfaction with the new tariff policy. Most recently, Cook cited Samsung as an example and told Trump that the tariff policy was not good for Apple. Trump also believed that Cook provided a " very good example " and bluntly stated that Apple was indeed " facing difficulties " in competing with other companies after paying tariffs . However, Trump did not respond to how to change this situation.

Data shows: Apple is increasingly dependent on China

Reuters data shows that in 2015, Chinese suppliers accounted for 44.9% of all Apple suppliers; by 2019, this proportion had quietly risen to 47.6%.

Bloomberg pointed out on the 29th that India does have some advantages in production activities such as assembling Apple's high-end models, but the cruel reality is that India's infrastructure is extremely backward and there is a shortage of skilled workers. More importantly, the parts needed to assemble Apple phones , such as batteries, semiconductors and processors, all need to be imported. Foxconn, which manufactures for Apple in Brazil, also faces similar problems.

Industry insiders said that even if Apple expands its production capacity around the world, it cannot be compared with China - " After all, apart from China, there is no place that can produce 600,000 mobile phones in one day.