US ‘to spare some Apple goods including Watch, AirPods headphones’ from latest China tariffs

The government is expected to release as early as Monday the final list of as much as US$200 billion of Chinese products that will be hit with a new 10 per cent tariff

PUBLISHED : Tuesday, 18 September, 2018, 2:52am
UPDATED : Tuesday, 18 September, 2018, 4:15am

The Trump administration will spare a category of hi-tech products that includes Apple’s Watch and its AirPods headphones from the next round of tariffs it is imposing on Chinese goods, according to two people familiar with the matter.

The government is expected to release as early as Monday the final list of as much as US$200 billion of Chinese products that will be hit with a new 10 per cent tariff, according to five people familiar with the matter.

A product code that covers Apple’s Watch and AirPods – as well as similar smartwatches, fitness trackers and other goods made by competitors – is not on the list, the two people said.

The people asked not to be identified because the new round of tariffs has not yet been announced. Apple did not respond to a request for comment.

The product code covers wireless devices, and it was included on a preliminary list the administration released in July. Other Apple products under the code include the HomePod speaker and AirPort and Time Capsule internet routers. The value of such imports from China is about US$12 billion, according to one of the people.

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Earlier this month, Apple said a “wide range” of its products would be hit by the proposed tariffs. The company did not identify the iPhone as a product that would be subject to duties in a September 5 letter to US Trade Representative Robert Lighthizer.

Apple asked Lighthizer to reconsider imposing the tariffs and instead take other measures that would support the US economy and American consumers.

“Tariffs increase the cost of our US operations, divert our resources, and disadvantage Apple compared to foreign competitors,” according to Apple’s letter. “More broadly, tariffs will lead to higher US consumer prices, lower overall US economic growth, and other unintended economic consequences.”

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Apple Chief Executive Officer Tim Cook – who dined with US President Donald Trump and his wife, Melania, at Trump’s Bedminster, New Jersey golf resort in August – has said he hopes “calm heads prevail” in the trade conflict between the US and China.

The company’s sprawling production chain is centred in China. Earlier this year, a Chinese Communist Party newspaper named Apple among the American companies that would be “most damaged” if a trade war erupted.

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American industry has come out strongly against Trump’s tariffs, saying cost increases could raise prices for consumers.

The administration has revised the list of Chinese goods that will be hit by tariffs following a feedback period and more than a week of public hearings last month. Like Apple, most US businesses that submitted comments were opposed to the tariffs being enacted.