US President Donald Trump’s recent remarks about helping Apple, which is in competition with Samsung Electronics, may not lead to tariffs being imposed on the South Korean mobile phone maker, according to sources in the industry.
Trump told reporters last week that Apple CEO Tim Cook was concerned about tariffs the US would impose on Chinese goods because Apple manufactures products such as iPhones, laptops and other goods in China. According to Reuters, Trump said: “I thought he made a very compelling argument, so I’m thinking about it.”
The remarks by Trump caused concern in South Korea that the US may impose tariffs on the cell phones of Samsung, Apple’s biggest competitor in the global mobile phone market. Samsung’s products are not subject to the tariffs as Samsung manufactures most of its mobile phones exported to the US in Vietnam and India.
Samsung has maintained the biggest share in the global cell phone market as well as the world memory chip market. As of the end of the first half this year, its mobile phone market share accounted for 18.3%, with its memory chip market share at 44.1%, according to market research firms Strategic Analytics and DRAMexchange.
While Samsung refused to comment on Trump’s remarks, industry experts predicted that Trump would take measures to help Apple rather than to damage Samsung.
“Levying tariffs on Apple’s products is a matter of origin,” an industry expert told Asia Times. “The US decided to impose tariffs on Chinese imports, and Apple iPhones are subject to the tariffs as they are produced in China.
“But, Samsung’s cell phones exported to the US are Vietnamese or Indian made. It appears too hard to impose tariffs on Samsung’s cell phones unless they do on other Vietnamese or Indian imports. It could be another trade war against these countries, which are highly unlikely to happen.
“The US government could give Apple benefits such as tariff refunds after imposing the tax on Apple’s Chinese-made products.”
Washington had planned to impose tariffs on an additional US$300 billion worth of Chinese goods from September 1, but some import duties on Chinese imports such as mobile phones and laptops were delayed until December 15.
Another industry source said: “Trump is not likely to damage Samsung by imposing a tax on cell phones. He is more likely to relieve Apple of tariffs burden.”
The first source added that the US government might push Apple to move its production site to the US or another country while giving the firm tariff benefits.
There was also a wild guess that Trump may also push Samsung to invest in the US. An industry expert told Asia Times: “It is difficult to figure out what Trump meant when he mentioned Apple and Samsung, but he may nudge Samsung into more investment in the US.”
Samsung Electronics run a logic chip plant in Austin, Texas, and a home appliance plant in Newberry County, South Carolina.