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May 23 - Apple (NASDAQ:AAPL) shares dropped by as much as 4% in early Friday trading after former U.S. President Donald Trump threatened to impose a 25% tariff on iPhones not manufactured domestically.
The comments, posted on Trump's Truth Social platform, targeted Apple's offshore production strategy. He said iPhones sold in the U.S. should be built within the country. If that is not the case, a tariff of at least 25% must be paid by Apple to the U.S., he wrote.
The post comes amid reports that Apple's key supplier, Foxconn (FXCOF), plans to invest $1.5 billion in a new facility in Tamil Nadu, India. The plant will reportedly produce display modules for Apple, part of the tech giant's ongoing efforts to diversify its supply chain beyond China.
Apple has steadily expanded manufacturing operations to countries including India, Vietnam, and Malaysia. Trump's remarks added pressure on the stock, which weighed on Nasdaq futures, down about 0.4% during early trade.
Market watchers said the tariff talk introduces fresh uncertainty for Apple, especially as it ramps up investment in Asia.
This article first appeared on GuruFocus.