An all-out trade war between the U.S. and China could upend the tech industry.
President Trump announced on Wednesday the U.S. would increase its tariff on Chinese goods to a rate of 125% after Beijing countered earlier tariffs with an 84% rate of its own on U.S. imports.
The White House says its latest move was to punish China for its retaliation to previous tariffs.
"You punch at the United States of America, President Trump is going to punch back harder," said White House Press Secretary Karoline Leavitt.
The back-and-forth tariffs between the two countries have major implications given America's reliance on Chinese imports.
The U.S. imported more than $438 billion in goods from China last year, according to data from the Census Bureau. That included $127 billion worth of electronics, according to Trading Economics, a site that tracks international trade.
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These newest tariffs could mean higher prices for laptops, tablets, phones and other electronics. The products could also take longer to be delivered to U.S. consumers, according to Jonathan Ernest, an assistant professor of economics at Case Western Reserve University.
"There could be a long wait for you to buy that next iPhone that you're waiting to hit the shelves," Ernest said. "Or it might just be much more expensive to rush, produce, or ship it from somewhere else other than that most efficient place that we had found."
Apple is planning to source more iPhones from India to avoid the heavier tariffs on China, according to the Wall Street Journal.
Even with that move, Apple could still pass along price increases to consumers. According to an estimate from TechInsights, an iPhone 16 Pro 256B could cost about an extra $300.
The White House wants the tariffs to encourage manufacturing at home and a shift away from reliance on overseas producers. Supply chain experts say that won't happen quickly and could be costly in the short term.
"We have to remember that China has been at this for 60 years," said supply chain expert, Kimberly Reuter. "They have been laser focused on becoming the biggest manufacturer in the world. So, we are not going to be able to duplicate that in six months. We don't have the infrastructure. We don' have access to the raw materials and we don't the skilled labor force to do it."
Bob Carpenter, the CEO of GS1 US, says that could be a long process.
"We think that this is probably at least a 12-to-24-month cycle for companies to move their supply chain," Carpenter said. "In the near term, there's going to be some pain, most likely in the form of higher prices."
Carpenter also noted it could hurt domestic producers who have customers in China.
"China is a huge market for the tech industry," Carpenter said. "I think this is going to preclude more and more tech companies being able to grow their revenue in the Chinese marketplace."
