Trump's bid to manufacture iPhone in US faces legal and economic challenges

NEW YORK/WASHINGTON: President Donald Trump’s bid to bring manufacturing of Apple’s iPhone to the United States faces many legal and economic challenges, experts said on Friday, the least of which are the insertion of “little screws” that would need to be automated.

Trump threatened on Friday to impose a 25% tariff on Apple for any iPhones sold, but not made, in the United States, as part of his administration’s goal of re-shoring jobs.

He told reporters later on Friday that the 25% tariff would also apply to Samsung and other smartphone makers. He expects the tariffs to go into effect at the end of June.

“Otherwise it wouldn’t be fair” if it did not apply to all imported smartphones, Trump said. “I had a understanding with (Apple CEO) Tim (Cook) that he wouldn’t be doing this. He said he’s going to India to build plants. I said that’s OK to go to India but you’re not going to sell into here without tariffs.”

Commerce Secretary Howard Lutnick told CBS last month that the work of “millions and millions of human beings screwing in little, little screws to make iPhones” would come to the United States and be automated, creating jobs for skilled trade workers such as mechanics and electricians.

But he later told CNBC that Cook told him that doing so requires technology not yet available.

“He said, I need to have the robotic arms, right, do it at a scale and a precision that I could bring it here. And the day I see that available, it’s coming here,” Lutnick said.

The fastest way for the Trump administration to pressure Apple through tariffs would be to use the same legal mechanism behind punishing tariffs on a broad swath of imports, trade lawyers and professors said.

The law, known as the International Emergency Economic Powers Act, allows the president to take economic action after declaring an emergency that constitutes an unusual and extraordinary threat to the United States.

“There’s no clear legal authority that permits company-specific tariffs, but the Trump administration may try to shoehorn it under its emergency power authorities,” said Sally Stewart Laing, a partner at Akin Gump in Washington.

Other means of levying company-specific tariffs rely on lengthy investigations, Laing said.

But tariffs on only Apple “would provide a competitive advantage for other important phones, which undermines Trump’s goals of bringing manufacturing to the United States,” Liang said.