iPhones Launching In 2019 Could Be Very Expensive, Thanks To US-China Trade War

Apple's iPhones are expensive enough, with even the now-cheaper iPhone X running you up at least Rs 74,000. Unfortunately for Apple fans though, they might about to get pricier.

And you can thank US President Donald Trump on the other side of the world for that.

Images courtesy: Reuters

You see, the Trump decided he was going to start a pissing contest with China by hiking tariff on products manufactured there (though many of his own companies do that too). His idea was apparently to force US companies to relocate manufacturing back home, though that isn't likely to be the outcome for many major brands. Instead, now the two countries are locked in a stalemate that could escalate at the drop of a hat.

Apple has a majority of its manufacturing process located in China, partly because of the cheaper labour available there. Because of this new tariff, they would have to up their prices to compensate, meaning an approximately 14 percent hike. The $750 iPhone XR would now cost an extra $100. Meanwhile the flagship iPhone XS Max would see a $200 rise to a total of about $1,650.

The thing is, this affects Indian prices of iPhones as well. There's no direct supply chain from Apple's manufactories in China to India, they have to go through the US for processing. At the very least, analysts at JP Morgan say Apple might be smart enough to not tick off their customer with even higher price tags on their already expensive devices. It's possible, they say, the company will instead choose to absorb the costs, at least for the time being.

But there's another ray of hope for us here. Apple has recently been in talks with the Indian government to discuss manufacturing locally. And we're not talking about its existing supply chains that focus on older, cheaper models. This time around, Apple also wants to manufacture its flagship iPhones in India too.

Shifting the large scale operations to India is in fact a win-win for everyone involved. Apple could once again avoid complications in tariffs with China, and they could use the subsidies and other benefits of manufacturing in India to help grow their market share here, something they've always struggled with.