What happened: Neither Chinese nor American authorities have targeted Apple with import tariffs, the company’s CEO Tim Cook said in an interview with CBS News last night, adding that he doesn’t expect they will. He argued that because iPhone components are manufactured in several countries and the final product is assembled in China, tariffs on iPhones would hurt many countries, but especially the US. Should American authorities decide to impose a tariff on the smartphone, which is assembled in China, the company’s business would certainly suffer a blow, Cook said, but he thinks that this scenario is unlikely. He added that he doesn’t expect China to use Apple as a retaliation tool as the Huawei standoff escalates.
Why it’s important: Cook’s comments come at a time when Apple’s position in global smartphone manufacturing is facing difficulties. New tariffs launched by the US against China earlier in May could affect iPhone sales, increasing the price of Apple’s line of smartphones by more than $100. At the same time, if Apple becomes a target of the Chinese government in an attempt to retaliate for banning Huawei, the Silicon Valley tech giant could face strong headwinds. Apple’ s revenue fell in the first quarter of 2019, largely due to decreased sales in greater China.