Whereas Apple has managed to carry the road on iPhone costs to this point, there’s each purpose to imagine that value hikes are only a matter of time. On the very least, prices associated to constructing, producing, and transport this yr’s iPhone 17 lineup into the tariff-laden US might begin to lower deeper into the corporate’s revenue margins.
The Trump administration’s tariff insurance policies have been a rollercoaster for everybody, leaving uncertainty lurking round each nook. Apple has been caught up in a few of this on-again-off-again cycle. In March, Apple flew planeloads of iPhones into the US to beat the primary large spherical of “retaliatory” tariffs that took impact in early April. This let it climate the storm with out elevating costs or consuming tariff prices.
By mid-April, the iPhone obtained a respite from tariffs when the Trump administration exempted “smartphones, computer systems and different electronics” from the majority of its tariffs on China. These exceptions utilized to all electronics in these classes, however additionally they coated practically all the pieces Apple makes (AirPods being the notable exception to this exception).
There have been indications that Apple CEO Tim Cook dinner’s “excellent relationship” with Trump helped Apple keep away from the tariffs — and at the least one Democrat senator is questioning that — however the reprieve isn’t anticipated to final lengthy, as President Trump and Commerce Secretary Howard Lutnick mentioned the administration’s purpose hasn’t modified; it expects Apple to construct iPhones in America, and the delayed tariffs are merely to supply extra time to regulate to that new actuality.
This implies it’s doubtless that new tariffs will likely be in place by September when Apple plans to launch its new iPhone 17 lineup. It’s been unclear how Apple plans to deal with this, however now The Wall Road Journal stories that the corporate is certainly contemplating charging extra for the iPhone 17 — nevertheless it additionally needs to keep away from pointing to tariffs as the explanation.
“The corporate is decided to keep away from any situation wherein it seems to attribute value will increase to U.S. tariffs on items from China, the place most Apple gadgets are assembled,” the WSJ’s Rolfe Winkler and Yang Jie reported, citing folks accustomed to the matter.
As a substitute, Apple will attempt to level to “new options and design adjustments” to justify the upper costs. Whereas the iPhone 17 Professional fashions are anticipated to characteristic a brand new aesthetic, these adjustments will doubtless solely be skin-deep; nonetheless, Apple additionally has a brand new “iPhone 17 Air” within the works that would shake issues up.
Apple might additionally replay the storage capability card that it used to sneak up the value of the iPhone 15 Professional Max in 2023 when it dropped the 128 GB mannequin from the lineup. That technically wasn’t a value enhance, because the 256 GB iPhone 15 Professional Max nonetheless bought for a similar $1,199 as all prior 256 GB fashions going again to the iPhone 12 Professional Max. Nevertheless, it was nonetheless successfully a value hike because it elevated the price of entry for that mannequin by $100 by eliminating the lower-cost possibility.
Reminiscence is comparatively low cost, particularly on the scale of Apple’s provide chain. Bumping all iPhone 17 fashions to begin at 256 GB could be a technique of raising-prices-without-raising-prices.
Apple might additionally considerably appropriately level to the truth that it hasn’t raised the value of the iPhone in practically a decade, even amid inflation. In any case, the iPhone X debuted at $999 in 2017, which is similar value the bottom iPhone 16 Professional sells for immediately, with twice the storage and considerably extra capabilities in comparison with its eight-year-old ancestor.
There’s been a bit extra uncommon value jostling among the many customary fashions. For six generations, from the 2011 iPhone 4S to the 2016 iPhone 7, the beginning value was $649. That jumped to $699 for the iPhone 8 in 2017, then $749 for the 2019 iPhone XR, after which again right down to $699 for the iPhone 11. The iPhone 12 mini then difficult issues by occupying the $699 value level, which pushed the usual iPhone 12 as much as $799, the place the bottom mannequin has remained ever since.
Inflation alone would make the $999 iPhone X price round $1,300 in immediately’s {dollars}. After all, know-how turns into outdated a lot sooner than the speed of inflation, nevertheless it’s nonetheless exceptional that Apple manages to repeatedly add new options to its iPhones with out elevating costs even barely.
Sadly, this could possibly be the yr that involves an finish. Tariffs are undoubtedly going to eat into Apple’s backside line. Nonetheless, it’s additionally very reluctant to level to that as the explanation after Amazon was pilloried by the White Home for committing a “hostile act” when a report surfaced that it’d present the impression of tariffs to its buyers. Cook dinner needs to remain on Trump’s good facet, however this might additionally spell unhealthy information for folk in nations that aren’t straight impacted by US tariffs. Regardless that Apple gained’t pay any extra to ship iPhones to different nations, comparable to Canada and the UK, elevating costs solely in the USA will nonetheless make it readily obvious that tariffs are the explanation.
Apple is engaged on diversifying its provide chain in hopes of transferring US iPhone manufacturing to India, the place the tariffs are considerably decrease. Nevertheless, that gained’t occur in a single day, and definitely not in time for this yr’s iPhone 17 launch.
“By the tip of 2026 or the start of 2027, we’re optimistic that India will likely be able to assembly each the U.S. and India’s demand, TechInsights analyst Abhilash Kumar advised the WSJ, however even then, “China will nonetheless be essential” for sourcing elements.
Even that’s an optimistic view, and different analysts recommend that will probably be very difficult for Apple to succeed in the type of manufacturing quantity in India that it wants to satisfy US iPhone demand.