After the US stock market closed on Wednesday (August 6), US President Trump announced that he would impose a 100% tariff on all imported products containing semiconductors, but would exempt companies that have already or have explicitly committed to moving production to the US.
Trump made the announcement alongside Apple CEO Tim Cook in the Oval Office of the White House. Apple announced an additional $100 billion investment in the US. Trump stated:
"We will impose very high tariffs on chips and semiconductors, but companies like Apple, if you build a factory in the US or have explicitly committed to build a factory in the US, will not be taxed."
"In other words, we will impose a tariff of approximately 100% on chips and semiconductors. But as long as you build a factory in the US, you will not be taxed. Even if you haven't started mass production yet, as long as you are already in the construction phase, you will not be taxed."
Media reports indicate that this announcement is a major victory for Apple and its CEO Cook. Previously, the Trump administration had been exerting pressure, threatening to impose high tariffs that could significantly increase the production costs of Apple's flagship products, the iPhone and Mac. Apple's newly announced $100 billion investment plan will launch a new manufacturing project aimed at relocating more production back to the United States.
Before the official announcement, media reports early Wednesday morning (US time) indicated that Apple, under pressure from tariffs, would invest another $100 billion in US manufacturing. This latest commitment brings Apple's total investment in the US to $600 billion.
The initial media reports of Apple's commitment to invest another $100 billion in the US boosted Apple's stock price by 5.1% on Wednesday, to $213.28. After the tariff news broke after the market closed on Wednesday, Apple's stock price continued to rise, at one point surging nearly 3%.
In addition, TSMC's ADRs initially fell before rising in the US market, rising nearly 2.9%. STMicroelectronics fell 3%, ASML ADRs fell over 0.16%, Nvidia rose 0.02%, Qualcomm fell 0.6%, and GlobalFoundries rose 1.6%.
Returning to the US to build a factory is expected to increase operating costs.
Apple announced an additional $100 billion investment in the US, with all iPhone and Watch glass produced locally. Trump said Apple will build the world's largest smart glass production line in the US.
Apple said its US manufacturing plan will include partnerships with companies such as Corning Inc., Applied Materials Inc., and Texas Instruments Inc.
Corning will build a new factory in Kentucky specifically for Apple glass production and increase its local workforce by 50%. Corning has supplied glass to Apple since the launch of the first iPhone, producing it at the same factory.
Apple previously pledged to invest $500 billion in the US over the next four years. This announcement represents an acceleration of that commitment, with approximately $39 billion in additional spending and 1,000 new jobs per year. This brings Apple's total US investment commitments to $600 billion.
The $500 billion in previously pledged investments includes a new server manufacturing facility in Houston, the establishment of a supplier academy in Michigan, and further collaboration with existing US suppliers.
Apple's new commitment comes as Trump is fully implementing his tariff plan. Analysts believe the plan could raise operating costs across Apple's entire international supply chain.
Trump also plans to impose a 50% tariff on India, a key Apple production base. Reportedly, according to an executive order signed by Trump on July 31st, the United States will impose a 25% tariff on Indian goods starting August 7th. Combined with the additional tariffs announced on the 6th, the overall tariff rate for Indian goods will be 50%.
Whether the investment plan will be fulfilled remains in doubt.
Cook, who attended Trump's inauguration and donated to his inaugural committee, has been lobbying the government to exempt Apple's iPhones from tariffs. Currently, most iPhones sold in the United States come from India, while other products, such as Apple Watches, iPads, and MacBooks, are primarily produced in Vietnam, which was already subject to a 20% tariff.
Since Trump's victory in the 2024 presidential election, dozens of CEOs, including Cook, have visited Trump's Mar-a-Lago resort in Florida and the White House, hoping to garner the support of the new administration and announce hundreds of billions of dollars in new investment plans.
However, according to previous media reports, many of these investments were actually planned before the election, or were on par with previous investments. Economists have also questioned whether these promised investments and new jobs will ultimately materialize.
Despite the significant investment scale, Apple's pledged investments still fall short of the goal envisioned by Trump and White House officials of "relocating all production back to the United States." Earlier this year, the day after Trump met with Cook at the White House, he threatened Apple with tariffs of at least 25% if it did not move iPhone production to the US.
In a conference call with analysts last week, Cook stated that while Apple remains committed to optimizing its supply chain, the company will ultimately "do more in the US."