Trump's tariffs could make Apple's iPhone cost up to $2.300.

(Reuters)- Your favorite iPhone may soon become much more expensive, thanks to tariffs.

US President Donald Trump has imposed a series of tariffs on countries around the world that could drastically alter the global trade landscape. Consumer goods such as iPhones could be among the hardest hit in the US, with price increases of 30% to 40% if the company passes the cost on to consumers, analysts said Thursday.

Most iPhones are still made in China, which has been hit with a 54% US tariff. If these tariffs persist, Apple faces a difficult choice: absorb the extra expense or pass it on to customers.

The company's shares fell more than 8% after the fare announcements, putting them on track for their worst day since September 2020.

Apple sells more than 220 million iPhones per year, and its largest markets include the United States, China, and Europe.

The cheapest iPhone 16 model was launched in the US with a price tag of $799, but could cost up to $1.142, according to calculations based on projections by analysts at Rosenblatt Securities. They say the cost could increase by 43% if Apple manages to pass that increase on to consumers.

A more expensive iPhone 16 Pro Max, with a 6,9-inch screen and 1 terabyte of storage, which currently sells for US$1.599, could cost almost US$2.300 if a 43% increase is passed on to consumers.

Trump imposed tariffs on a wide range of Chinese imports during his first term as president to pressure American companies to bring manufacturing back to the U.S. or to nearby countries like Mexico, but Apple managed to secure exemptions for several products. This time, Trump has yet to grant any exemptions.

The iPhone 16e, launched in February as a cheaper entry-level model for Apple's suite of artificial intelligence features, costs $599. A 43% price increase could raise the cost to $856. Prices for other Apple devices may also rise.

Apple did not immediately respond to a request for comment. Many customers pay for their phones over a two- or three-year period through contracts with their mobile carriers.

However, other analysts have noted that iPhone sales are weak in the company's key markets, as Apple Intelligence, a suite of features that helps summarize notifications, rewrite emails, and give users access to ChatGPT, has failed to excite buyers.

Expert reviews suggested that the features, while innovative, do not provide sufficient compelling reasons to justify upgrading to newer models.

Stagnant demand could put additional pressure on Apple's results, especially if costs increase due to tariffs.

Angelo Zino, equity analyst at CFRA Research, said the company will have difficulty passing on more than 5% to 10% of the cost to consumers.

"We expect Apple to postpone any significant price increases for cell phones until the fall, when the iPhone 17 will be released, as this is how they usually handle planned price increases."

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Even with some production being transferred to Vietnam and India, the majority of iPhones are still manufactured in China. At the same time, these countries were not spared tariffs, with Vietnam receiving a rate of 46% and India reaching 26%.

Apple would need to raise its prices by at least 30%, on average, to offset import taxes, according to Counterpoint Research co-founder Neil Shah.

A potentially sharp price increase could reduce demand for the smartphone and give Samsung Electronics an advantage, since South Korea faces lower tariffs than China, where all iPhones sold in the US are manufactured.

"Our quick calculations on Trump's Liberation Day tariff suggest that this could blow up Apple, potentially costing the company up to $40 billion," noted Barton Crockett, an analyst at Rosenblatt Securities, adding that negotiations between Apple, China, and the White House are likely.

"It's hard to imagine Trump blowing up an American icon... but that seems quite challenging."

(Reporting by Akash Sriram in Bengaluru)