President Donald Trump ratcheted up the US trade war on Friday, threatening to impose a new 25 percent levy against Apple, and a 50 percent tariff on the European Union.
Lamenting that negotiations with the EU “are going nowhere,” Trump said on Truth Social that he is recommending “a straight 50% Tariff on the European Union, starting on June 1, 2025.”
If the new duties come into effect, they would dramatically hike the current US baseline levy of 10 percent, and raise economic tensions between the world’s biggest economy and its largest trading bloc.
In a separate message, the president said Apple had failed to move iPhone production to the United States despite his repeated requests, and he threatened new duties of “at least” 25 percent if they did not comply.
Stock futures on Wall Street fell on the news, with Apple’s share price plunging more than three percent in pre-market trading.
The VIX volatility index, known as Wall Street’s “fear gauge,” was up more than 20 percent.
– ‘Difficult’ negotiations –
Last month, Trump imposed sweeping tariffs against most countries, introducing steep duties for several trading partners — including the EU — and sector-specific measures on automobiles, steel and aluminum not produced in the United States.
Markets tanked following the announcement, and a few days later, the US president announced he would roll back the higher levies to 10 percent for a 90-day pause to allow for trade negotiations, while keeping the sector-specific measures in place.
US President Donald Trump has threatened to hike tariffs on goods from the European Union to 50 percent – Copyright AFP Jim WATSON
Since then, Trump has announced a deal to permanently roll back some sector-specific tariffs on Britain, and another agreement with China to reduce prohibitively-high levies and retaliatory measures for 90 days.
The talks between the United States and the EU have failed to make much progress, with Brussels recently threatening to hit US goods worth nearly 100 billion euros ($113 billion) with tariffs if it does not lower the duties on European goods.
In his early morning social media post on Friday, Trump said the EU had been “formed for the primary purpose of taking advantage of the United States on TRADE,” and took a swipe at the “difficult” negotiations taking place.
An EU spokesperson declined to comment on the threats of new tariffs, telling AFP that a call was set to take place later Friday between EU Trade Commissioner Maros Sefcovic and US Trade Representative Jamieson Greer.
– US-made iPhones ‘not feasible’ –
Trump’s fresh criticism of Apple revived the pressure on chief executive Tim Cook to do more to bring manufacturing jobs back to the United States from Asia.
The problem, according to Wedbush Securities analyst Dan Ives, is that reshoring iPhone production to the United States “is a fairy tale that is not feasible.”
“This would result in an iPhone price point that is a non-starter for Cupertino and translate into iPhone prices of ~$3,500 if it was made in the US,” he wrote in a note to clients.
This, he added, “is not realistic,” adding that it would take up to 10 years to shift production to the United States.
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