Cook: iPhone is 'made everywhere,' but US would be 'hurt most' from tariff
Apple CEO Tim Cook in a CBS Evening News interview aired Tuesday touched on hot-button issues like the U.S.-China trade war, saying his company has not yet been impacted by the international scrum. He also commented on recent scrutiny of Apple's outsized presence in the tech sector, its efforts to curb so-called device addiction and more.
Speaking with CBS Evening News managing editor Norah O'Donnell, Cook noted that while Apple has yet to see negative effects from the trade war, a potential tariff on iPhone would undoubtedly put a damper on sales.
Apple avoided a recent tariff hike on Chinese goods, but the company could get caught up in a another round of proposed levies worth $325 billion. Noting that a 25% tariff on the already expensive iPhone XS would add another $160 to its final price, O'Donnell asked whether such a scenario would impact sales.
"Sure it would. I'm hoping that doesn't happen," Cook said. "The truth is, the iPhone is made everywhere. It's made everywhere. And so -- a tariff on the iPhone would hurt all of those countries, but the one that would be hurt the most is this one."
For now, however, iPhone and other Apple devices are for the most part free and clear of President Trump's tariff play. The Chinese have also left Apple untouched.
"Well, it -- currently -- the Chinese have not targeted Apple at all. And I don't anticipate that happening, to be honest," Cook said.
Cook said much the same in April, noting effects of the trade war were near non-existent. At the time, the executive touted Apple's performance in the important growth market, saying sales were on the mend after a trouncing in late 2018.
It has been speculated that the exemption of Apple products from America's major tariff rounds is in part thanks to Cook's working relationship with Trump. Reports last year claimed the Trump administration promised Apple, and more specifically iPhone, would not be caught up in what has become a brutal trade struggle.
Cook commented on his relationship with Trump during Tuesday's CBS Evening News interview.
"I think we've had very straightforward discussions, many of them. He listens to the comments, which I appreciate," Cook said of Trump. "Sometimes he doesn't agree. But my philosophy on things is that, you always engage, even when you know that you're gonna wind up on very opposite sides."
O'Donnell pointed out that Cook, unlike other tech CEOs, regularly engages with the White House.
"I do. And I'm proud to. I mean, because I don't believe in the 'I disagree with you, and so I don't want to have anything to do with you,'" Cook said. "The way you stop the polarization is to talk. This is sort of like step one. And -- I don't want to be part of the problem. I want to be part of the solution."
The Apple chief also responded to criticisms charging the company is a monopoly. As seen on Monday in a preview of the full interview, Cook disagreed with assertions that Apple is "too big."
"No, I don't think so. I think that with -- but with size, I think scrutiny is fair. I think we should be scrutinized," he said. "I don't think anybody reasonable is going to come to the conclusion that Apple's a monopoly. Our share is much more modest where we don't have a dominant position in any market."
Cook said in no uncertain terms that Apple is not a monopoly. He also took issue with Sen. Elizabeth Warren's (D-MA) call to break up big tech companies.
O'Donnell quoted Warren, who is running for president in 2020, as saying, "Apple should break up its App Store and other parts of its business."
"Well, I strongly disagree with that. I think some people would argue, if you are selling a good, then you can't have a product that competes with that good. That's an argument more that takes you down the path that Walmart shouldn't be stocking alternative or house brand," Cook said. "And so this is decades of U.S. law here. And we'll be -- we'll tell our story to anybody that we need to or that wants to hear it."
O'Donnell asked Cook about Screen Time, an iOS feature designed to help users better manage device usage. Echoing previous comments on the feature, Cook lauded Screen Time's ability to curb device addiction.
"I'm saying we made the phone not so that you'll use it all the time. We made the phone to make your life better," Cook said. "But for me, my simple rule is if I'm looking at the device more than I'm looking into someone's eyes, I'm doing the wrong thing."
Apple will expand Screen Time's capabilities as part of iOS 13 and introduce the feature on macOS 10.15 Catalina, both of which is slated to debut this fall.
Cook went on to reiterate remarks regarding immigration and data privacy.
Speaking with CBS Evening News managing editor Norah O'Donnell, Cook noted that while Apple has yet to see negative effects from the trade war, a potential tariff on iPhone would undoubtedly put a damper on sales.
Apple avoided a recent tariff hike on Chinese goods, but the company could get caught up in a another round of proposed levies worth $325 billion. Noting that a 25% tariff on the already expensive iPhone XS would add another $160 to its final price, O'Donnell asked whether such a scenario would impact sales.
"Sure it would. I'm hoping that doesn't happen," Cook said. "The truth is, the iPhone is made everywhere. It's made everywhere. And so -- a tariff on the iPhone would hurt all of those countries, but the one that would be hurt the most is this one."
For now, however, iPhone and other Apple devices are for the most part free and clear of President Trump's tariff play. The Chinese have also left Apple untouched.
"Well, it -- currently -- the Chinese have not targeted Apple at all. And I don't anticipate that happening, to be honest," Cook said.
Cook said much the same in April, noting effects of the trade war were near non-existent. At the time, the executive touted Apple's performance in the important growth market, saying sales were on the mend after a trouncing in late 2018.
It has been speculated that the exemption of Apple products from America's major tariff rounds is in part thanks to Cook's working relationship with Trump. Reports last year claimed the Trump administration promised Apple, and more specifically iPhone, would not be caught up in what has become a brutal trade struggle.
Cook commented on his relationship with Trump during Tuesday's CBS Evening News interview.
"I think we've had very straightforward discussions, many of them. He listens to the comments, which I appreciate," Cook said of Trump. "Sometimes he doesn't agree. But my philosophy on things is that, you always engage, even when you know that you're gonna wind up on very opposite sides."
O'Donnell pointed out that Cook, unlike other tech CEOs, regularly engages with the White House.
"I do. And I'm proud to. I mean, because I don't believe in the 'I disagree with you, and so I don't want to have anything to do with you,'" Cook said. "The way you stop the polarization is to talk. This is sort of like step one. And -- I don't want to be part of the problem. I want to be part of the solution."
The Apple chief also responded to criticisms charging the company is a monopoly. As seen on Monday in a preview of the full interview, Cook disagreed with assertions that Apple is "too big."
"No, I don't think so. I think that with -- but with size, I think scrutiny is fair. I think we should be scrutinized," he said. "I don't think anybody reasonable is going to come to the conclusion that Apple's a monopoly. Our share is much more modest where we don't have a dominant position in any market."
Cook said in no uncertain terms that Apple is not a monopoly. He also took issue with Sen. Elizabeth Warren's (D-MA) call to break up big tech companies.
O'Donnell quoted Warren, who is running for president in 2020, as saying, "Apple should break up its App Store and other parts of its business."
"Well, I strongly disagree with that. I think some people would argue, if you are selling a good, then you can't have a product that competes with that good. That's an argument more that takes you down the path that Walmart shouldn't be stocking alternative or house brand," Cook said. "And so this is decades of U.S. law here. And we'll be -- we'll tell our story to anybody that we need to or that wants to hear it."
O'Donnell asked Cook about Screen Time, an iOS feature designed to help users better manage device usage. Echoing previous comments on the feature, Cook lauded Screen Time's ability to curb device addiction.
"I'm saying we made the phone not so that you'll use it all the time. We made the phone to make your life better," Cook said. "But for me, my simple rule is if I'm looking at the device more than I'm looking into someone's eyes, I'm doing the wrong thing."
Apple will expand Screen Time's capabilities as part of iOS 13 and introduce the feature on macOS 10.15 Catalina, both of which is slated to debut this fall.
Cook went on to reiterate remarks regarding immigration and data privacy.
Comments
One could argue that the reason Apple's services aren't entirely banned in China (like every other major US tech company) is solely because of their massive job giving status in the country.
Because of our stupidity and greed, the Chinese are living in the 21st century country, whereas most US cities look like they did in the early 1900s. Our railroads are dilapidated, while the Chinese are riding is bullet trains. We have not won a single war since WWII (except the Grenada invasion), while having the largest defense budget in the world that exceeds the defense budgets of the next six countries combined. China has built the second strongest military in the world while having spent a fraction of the US defense budget. If, God forbid, there should be a war between the US and China, it's absolutely not clear who would come out on top in a conventional military conflict. A war with China would be the most catastrophic war that the US has ever entered.
The Chinese have executed flawlessly on their modernization program. We are the only ones to blame for what happened. Had it not been for our greed, the Chinese would still be living in adobe huts with roofs made of straw.
Quite a novel you wrote, but most of it is bunk. Most US cities do not look like they did in the 1900s, and not sure what winning wars has to do with anything. And it’s clear you know nothing about China, a country where most people live in rural areas, the air is heavily polluted, and industrial accidents are a way of life. But yes they have nice trains.
By the way, Grenada was not a war.
Which would explain why Apple is working on their proprietary tech which should not only be cheaper but better.
Hopefully a different manufacturer will produce them so Apple stops feeding the beast and iKnockoff users can stop believing Samsung designs the iPhone display.
But it's a tricky situation now. Who knows what the best way to deal with it is. One thing is sure though, the US (and Canada, etc) was not thinking very clearly about the longterm future as we greedily consumed cheap Chinese-manufacturing.
Some things will come back to the U.S. Some things will move to Indonesia and India and other locations. Who knows what they will look like 30 years from now. China could end up taking a huge hit. The U.S. for now end up paying a little more for products. That's fine by me. Just means I buy less. Which again just Hurts China even more so. I'm already on the iPhone 4 year plan. My iPhone 4, 4 years. My iPhone 6, 4 years, my iPhone XS I have another 3+ years to go I guess. Maybe by then the trade war will be over.
This can end today. All China has to do is have FAIR trade. I'm glad someone is finally doing something about it. China has gotten away with their crap for far to long. What else can we do at this point? We aren't going to go into a actual WAR with China over this. Nothing done up this this point for all these years has done anything. Really all that is left is Tariffs. What else can be done?
The iPhone may be safe, for now. But again, China is thinking long-term. Chinese firms are in a position to overtake Apple internally. The Chinese government has far stronger support for its efforts than the US -- it's baked-in for totalitarian regimes.
China is catching up very, very quickly especially here: https://www.washingtonpost.com/world/national-security/us-military-risks-falling-victim-to-chinas-effort-to-gain-technology-edge-report-warns/2019/06/05/c051204e-87b7-11e9-b1a8-716c9f3332ce_story.html?noredirect=on&utm_term=.9610083d4dd4
They have stealth fighters as well: https://chinapower.csis.org/china-chengdu-j-20/
And they do have bombers: https://www.nextbigfuture.com/2018/12/chinas-h-20-stealth-bomber-copy-of-the-us-b2-leads-a-new-wave-of-military-gear.html
I wouldn't underestimate China because they probably have some things under their sleeves that the U.S. doesn't know about. I suspect they might be able to take us on way before 2050, so the 2030s is a realistic time frame.