US President Donald Trump is prepared to make the hard decisions in the country’s trade spat with China. It seems, however, that he might be willing to yield some ground if those decisions actually put big US companies at a terrible disadvantage. That is practically the image painted by Trump’s statements, saying that Apple CEO Tim Cook made a very compelling argument on how the upcoming 10% tariff could adversely affect its competition with Samsung who isn’t affected by such tariffs at all.
The 10% tariff on goods imported from China is one of Trump’s bargaining chips in the trade war. The order is supposed to go into effect on September 1 but the US president delayed it for some good up to December 15 so as not to affect the holiday shopping season. The latter batch includes iPhones due to launch next month.
Apple, naturally, complained about the tariffs and made its case when CEO Tim Cook had dinner with President Trump last Friday. During that dinner, Cook used an argument that would appeal to Trump best. He explained that the tariffs would, in the long run, make Trump’s poster boy of American smartphone innovation buckle under Samsung’s advantage.
Unlike Apple, Samsung builds its devices across different countries in addition to China. The South Korean company also enjoys having no tariffs on products imported from China. In short, Apple and its customers will end up paying more because of those tariffs which would make Samsung’s smartphones more tempting and more affordable.
Trump told reporters that Cook made a very compelling argument but that’s pretty much all that he was willing to say. Apple has been asking for an exception to the tariffs and, if Trump is indeed convinced, it could get that privileged status. That, however, might not come in time for the September 1st deadline that will affect its Apple Watch, AirPods, and other accessories.