The giant US technology company, Apple Inc., is likely to get benefits from tariff exemption after President Trump’s visit at the company’s newly constructed office at Austin, Texas on Wednesday, November 20, 2019.
Trump is willing to exempt the company’s tax restrictions on its Chinese imports as most of its products including iPhones, iMacs are assembled in China.
America’s Design of Mac Pro
The company’s CEO, Tim Cook, refers to Apple’s Mac Pro as “a product of American design, American manufacturing, and American ingenuity’.
This new facility is worth $ 1 billion. This manufacturing unit will begin the production of Mac Pro, a new high-design computer, in 2022. It will be Apple’s second major domestic-based manufacturing unit, besides the one in Cupertino, California.
Trump stated his major concern and asked Apple to set up its companies and production units within the US instead of the foreign countries. During the tour, focusing on the idea of ‘designed by and assembled in the US’, he expressed,
“I said someday we are going to see Apple building plants in our country, not in China, and that’s what is happening, it is all happening”.
Striving Competition against Samsung
The main reason for Trump’s decision to exempt tariff is to strengthen Apple’s competition against the South Korean smartphone manufacturing company, Samsung. Samsung has a trade deal with the US, which gives certain advantages for the company through tariffs relaxations.
Setting up new companies in the US will increase the number of high-profiles white-color jobs for the American in areas such as engineering, finance, and sales. This, in turn, is expected to help the country’s economy grow.
Mentioning the requirement of 15 parts for the installment of Mac Pro, Tim has already made the request to the US Government for tariff relaxation on China imports in early September 2019.
Having accepted 10 out of 15 Apple’s request for the exclusion of tariffs, the company expects to commence its proposal for another round of tariff exclusion request on December 15, 2019.
Trump’s Offer: A Special Treatment for Apple
Amid the uncertainty of the US-China trade deal, Trump’s decision is a big relief for Apple. In support of Apple’s plans of setting up a production facility at Texas, Trump stated,
“The nice part is he (Tim) does not have to worry about tariffs… because when you build in the United States, you do not have to worry about tariffs”.
Trump intends to encourage Apple to construct manufacturing units in America rather than China. This is likely to nudge Apple to produce its various devices such as Apple Watches, MacBook, and iPhones in the country.
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