This is not a great time to be a tech executive. If it isn’t the EU running the rule over your business, the US president might just have a bone to pick with you.
Spare a thought for Apple chief executive Tim Cook, for example. It seems like he can’t do right for doing doing wrong these days, at least as far as Donald Trump is concerned. Taking a brief break from championing the rights of South African farmers and threatening penguins with tariffs, Trump has gone on a crusade against Apple and Cook.
After dodging a 145 per cent tariff on iPhones made in China, the US president has now threatened Apple with a 25 per cent levy.
Apple’s previous moves to mollify the US president seem ineffective now. A $500 billion investment that would see teams and facilities across the US expand, a new factory in Texas, a doubling of the US Advanced Manufacturing Fund, a manufacturing academy, and increased investments in AI and silicon engineering have failed to measure up to Trump’s expectations.
The latest problem? On the face of it, it is that Apple is choosing to expand its manufacturing in India and won’t commit to making iPhones destined for US users on American soil.
There is a very good reason for that. If the estimates are correct, any attempt to do that would see the price of the devices surge, effectively wiping out any impact that dodging the tariffs would have.
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Given the cost of doing business in the US compared to India, it may well turn out cheaper for Apple to swallow the 25 per cent tariff than take a loss on the iPhones it would be forced to build for the US market.
But there is another possible catalyst for the current tirade against Cook: he reportedly turned down an invitation to join Trump’s trip to the Middle East. Nvidia CEO Jensen Huang, meanwhile, accepted, meaning that for the next few weeks at least, he gets a reprieve from Trump’s ire.
But industry watchers will remember a time when Cook was considered the “Trump whisperer” among his favoured executives. Like bullies in all walks of life, it is only a matter of time before the uncomfortable glare will settle on the next victim. It could easily be one of Trump’s current favourites.
