The reciprocal tariffs imposed by the United States on April 2 are expected to deal a significant blow to major American corporations, including Apple and Nike, which rely heavily on production facilities in China, Vietnam, and India. President Donald Trump announced steep tariff rates ranging from 26% to 54% on goods from these key Asian manufacturing hubs. The stock prices of several U.S. companies dropped sharply in response.
Trump’s announcement came at 4 p.m., shortly after the closing bell of the New York Stock Exchange. Shares of Apple—the largest U.S. company by market capitalization—plunged more than 7% in after-hours trading. Over the past several years, the company has strategically shifted portions of its supply chain to China, Vietnam, and India. After the Trump administration’s initial wave of China tariffs in 2018, Apple moved the production of iPads and AirPods to Vietnam and shifted a portion of iPhone production to India. Around 90% of global iPhone output is still based in China, but the company aims to increase India’s share to 25%.
President Trump announced a new round of reciprocal tariffs on China, imposing an additional 34% levy that, when combined with the existing 20% rate, raises the true tariff rate on Chinese goods to 54%. Tariffs on goods from Vietnam and India have been set at 46% and 27%, respectively. According to Morgan Stanley, if the tariffs on China remain in place, Apple could see a 7% drop in annual revenue by 2026.
Apparel brands with substantial operations in Vietnam are also bracing for impact. Bloomberg reported that Nike, which manufactures half of its footwear in Vietnam, saw its shares fall 6.4% in after-hours trading. Lululemon, which sources roughly 50% of its products from Vietnam, experienced a more than 10% decline in its stock price.
Jeong-Soo Hong hong@donga.com