Apple is preparing for a hot autumn: according to the Wall Street Journal, the next iPhone 17 could hit the market with increased prices, in response to the growth of skyrocketing production costs.. A decision that the Cupertino giant is apparently trying to make without publicly linking it to US-China tariffs, to avoid a reputational boomerang similar to the one that hit Amazon when it hypothesized to explicitly include customs costs in consumer prices, triggering the ire of the White House.
But the communication strategy does not change the accounts: Cupertino foresees additional costs for $900 million in this quarter alone.
Truce on duties, but 20% tax remains
Although the recent agreement between Washington and Beijing has suspended most of the reciprocal duties, a duty of 20% on Chinese products, imposed by Donald Trump at the beginning of his second term with the official motivation of combating fentanyl trafficking. Apple smartphones, assembled mostly in China, are affected by this tax, while other electronic devices are exempt or subject to lower rates.
The problem for Apple is that the Temporary reduction of some duties (from 125% to 10%) does not affect iPhones, which continue to be heavily taxed. A situation that makes price adjustments are inevitable, especially for the high-end versions.
Most affected models: iPhone Pro and Pro Max
The top models will probably be most affected by the new tariffs: iPhone 17 Pro and Pro Max, which already start at 999 and 1.199 dollars respectively. According to the investment bank Jefferies, in addition half of the sales of iPhones in the United States concerns precisely these models. Their specific weight on profits is crucial, and this is where Apple has less margins for absorb costs without affecting prices.
Chinese factories will continue to produce these devices, because theIndia, although growing, does not yet have the technical and infrastructural capacity to handle mass production more advanced models, equipped with sophisticated cameras and more powerful batteries.
New features to justify price increases
To make the price increase more digestible, Apple will focus on some new productThe previews speak of a new ultra-flat design and the possible introduction of a folding model, elements that could position the iPhone 17 as an innovative product and not simply more expensive.
In order not to repeat Amazon's communication blunder - which was attacked by the White House after a rumor about possible price transparency towards customers - Cupertino aims to present the possible increase as the natural result of product improvement. The idea is clear: present the price increases as the result of technological evolution, and not as a forced response to supply chain instability or U.S. trade policy.
India and Reshoring: The Limits of Alternatives
Apple has already started a partial relocation of production to India, which today represents approximately 13-14% of global iPhone shipments. Tim Cook said that in the second quarter of 2025, the majority of iPhones sold in the United States will come from Indian factories. But only for the base models. The Pro and Pro Max remain firmly in Chinese hands.
In the long term, Apple is also considering a reshoring in the United States, but according to the WSJ it's about a plan that will take years to become operational. Until then, Cupertino will remain exposed to tariffs and Chinese geopolitical risk.
A fragile balance: protecting margins without losing customers
Apple is therefore moving on a delicate balance: protect profit margins without compromising brand perception or customer loyalty. The price increase – if confirmed – will be presented as part of a natural evolution of the iPhone line. But in the background remain $900 million in extra costs per quarter, somewhere to recover.
The question now is whether consumers will be willing to pay more, even for a thinner iPhone or a new form factor, in a market that is showing signs of saturation. But for Apple, maintaining high margins remains the priority. And this time, China won't be the only problem: it will be the users' wallets.
