China-based suppliers see prices fall
Donald Trump has seemingly triggered a drop in the shares of China-based suppliers of Apple Inc after threatening price increases against the tech giant on Twitter.
The president claimed “prices may increase” for the world’s most popular smartphone provider thanks to “massive tariffs we may be imposing on China,” in a message calling on Apple to manufacture its products in the US.
“Apple prices may increase because of the massive Tariffs we may be imposing on China – but there is an easy solution where there would be ZERO tax, and indeed a tax incentive,” he wrote on Saturday afternoon. “Make your products in the United States instead of China. Start building new plants now.”
“Exciting!” he continued, ending his post with the hashtag #MAGA.
By Monday, at least three China-based Apple suppliers saw their shares fall in Asia by as much as 10 per cent, including Luxshare Precision CO Ltd, Shenzhen Sunway Communication Co Ltd and Suzhou Dongshan Precision Manufacturing Co Ltd.
Another three suppliers — Lens Technology Co Ltd, Universal Scientific Industrial Shanghai Co Ltd and Suzhou Anjie Technology Co Ltd — all fell more than six per cent.
Meanwhile, Apple Inc was reportedly on track to continue a three-day losing streak ahead of its annual fall product launch, where it is expected to release new iPhone models and other technology products. The company’s stock fell nearly 1.6 per cent on Monday morning, while its Taiwan-based suppliers also fell between 2.9 and four per cent.
But Apple has continued to enjoy historic stock market success, topping $1tn earlier this month and joining Amazon as one of the only companies to surpass the milestone.
Mr Trump’s administration has continued to launch aggressive tariffs against China, with the president vowing to slap another set of tariffs on nearly $267bn worth of goods.
“People are in a bit of a panic today,” Kevin Chung, analyst at JihSun Securities Investment and Consulting, told Reuters in an interview on Monday.
The company could see a rebound on Wednesday when it unveils its latest series of products, as such announcements in past years have proven beneficial to its stocks.
In a letter to the president, Apple implored the US government “reconsider” its tariffs against China.
“It is difficult to see how tariffs that hurt US companies and US consumers will advance the Government’s objectives with respect to China’s technology policies,” the company said in the letter. “We hope, instead, that you will reconsider these measures and work to find other, more effective solutions that leave the US economy and US consumer stronger and healthier than ever before.”