Trump Not to Make a Compromise for Apple -- Does He Have a Point?

Trump%20Not%20to%20Make%20a%20Compromise%20for%20Apple%20--%20Does%20He%20Have%20a%20Point%3F
source: Pixabay

President Trump declined Apple's request to exempt the tech giant from paying tariffs on parts for the new Mac Pro, which Apple would reportedly assemble in China.

The President tweeted Friday that if Apple wants to be granted a tariff relief, it should move its production in the United States. Trump also hoped that the company would invest in a plant in Texas. 

 Apple has not immediately commented on the President's words. However, the company had issued a statement previously pointing out that the new Mac Pro, and the rest of its products, were designed and engineered in California. The firm admitted that the production also included some parts made overseas but highlighted that the final assembly was only one part of the whole process. 

Apple also mentioned that the final assembly of the current version of Mac Pro takes place in Texas. The tech giant also emphasized that it already spent USD 60 billion on domestic suppliers, supporting hundreds of thousands of jobs nationwide.

Later on Friday, Trump touched upon the issue again in a tweet saying that he would ''work the issue out'' with the Apple's CEO Tim Cook.

China has a strategic meaning for Apple, both as a key market and a leading production center for its devices. Nearly 18% of Apple's total revenue for the quarter that ended in March came from Greater China, the company announced.

In the letter to the U.S. Trade Representative asking for the waivers, Apple asserted that the products in question were part of a consumer electronic device. In Apple's words, they were not related to Chinese industrial programs such as ''Made in China 2020.''

Tim Cook and Donald Trump already met to discuss the tariffs when they first announced. According to Tim Cook, the tariffs have a severe impact on Apple's global competitiveness as the Chinese firms compete with the products Apple creates.

In Trump's view, Apple would not only be exempted from tariffs, but it would also gain tax incentives if it builds a plant in Texas.

Compared to the other companies caught in the US-Chinese tariff trap, Apple is in a more favorable position, mainly due to the soft skills of Tim Cook.  Cook managed to keep Apple's China-manufactured iPhones off the list of Chinese imports that Trump has slapped with nearly $250 billion in tariffs. 

In addition to that, in December last year, Apple confirmed plans to build a second campus in Austin, Texas. Furthermore, Apple now has a $390 million contract with Finisar Corp. It allowed the latter to re-open its 700,000-square-foot facility in Texas.

Do you agree or disagree with the President's Trump decision to deny tariff relief for Apple Mac Pro produced in China?