Published: Wed, September 12, 2018
Money | By Ralph Mccoy

Companies shift production overseas to avoid United States tariffs

Companies shift production overseas to avoid United States tariffs

Following recent statements from US President Donald Trump that Apple should produce its devices in the US to avoid Chinese import tariffs, analysts have weighed in on the matter. "Exciting!" Trump said Saturday in a tweet aimed at the Cupertino, California-based company.

"The burden of the proposed tariffs will fall much more heavily on the United States than on China", Apple said in its letter. As for Ford, the automaker in August acknowledged it was as soon as losing plans to ship the hatchback-vogue Focus Active from China to The US, citing Mr. Trump's fresh tariffs. He added that he's ready to place yet another round of tariffs on $267 billion in Chinese goods after that - bringing the total imports from China subject to tariffs to more than $500 billion.

President Donald Trump's proposed $200 billion tariff on Chinese-made goods won't make your next iPhone more expensive, but it might hit the Apple Watch, Pencil, and Air Pods, according to Apple.

Hong Kong stocks suffered the sharpest losses, falling 1.3 percent in the morning, while Shanghai slipped 0.8 percent with news that China's surplus with the USA hit a record in August adding to concerns Trump will push ahead with the tariffs.

"[Ford can make Focuses] in many other plants around the world, so if they chose to continue to sell a Focus variant in the USA market, there are several options other than building it in the United States".

Intel Corp said proposed tariffs would negatively affect USA businesses and "stifle advancements" in telecom infrastructure, including next generation technologies like 5G.

On the companies front Primark owner Associated British Foods reaffirmed its full year guidance as it said that it expected to report a rise in full year like for like sales of 1.5% with United Kingdom stores helping drive the move higher.

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In a tweet on 08 September, Trump said that if Apple wants to avoid tariffs on its products, it should make those devices in the U.S. rather than China.

Apple is not the first company Trump has targeted on Twitter for foreign manufacturing. The US imported $505 billion in goods from China previous year.

Long Guoqiang, vice-president of the Development Research Center of the State Council, said China has ensured fair treatment for its goods, personnel and capital overseas. "Start building new plants now", Trump tweeted.

Apple also mentioned that tariffs would raise the cost of servers, hard drives and cables for USA data centers.

The Trump administration's decision to impose tariffs on China triggered swift retaliation, setting off a back and forth that has been escalating for months. "We are puzzled as to why the Administration may be using tariffs in part to re-engineer global ICT (information, communication and technology) supply chains that have served United States companies so well".

Apple has created a US$5b fund to encourage innovation among its domestic suppliers, which are themselves getting caught in the trade crossfire. He said Japan will have a "big problem" if it doesn't conclude a new trade deal with the U.S.

Trump has criticized China's record trade surplus with the United States, and has demanded that Beijing cut it immediately.

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