Investing.com -- In response to heightened tariffs on Chinese goods, Apple (NASDAQ: AAPL ) is shifting more iPhone production to India, according to a report from the Wall Street Journal, citing sources familiar with the matter. This move is seen as a temporary measure while Apple seeks an exemption from the tariffs imposed by President Trump, similar to what it obtained during the first Trump administration.

The recent tariff package introduced by Trump has increased levies on Chinese goods to at least 54%, while imposing a 26% rate on Indian goods. On Monday, Trump warned of additional tariffs on China if the country does not withdraw its retaliatory duties announced after the U.S. tariff plans were disclosed on April 2.

The iPhone, which accounts for about 50% of Apple’s revenue, is primarily manufactured in China. This heavy reliance has raised concerns among investors about the company’s exposure to tariffs, resulting in a 20% drop in Apple’s shares, marking their worst three-day performance in almost 25 years.

The tariff on Chinese goods could potentially add approximately $300 to the current $550 hardware cost of an iPhone 16 Pro, which currently retails for $1,100, as stated by TechInsights. However, Apple could mitigate the impact by importing phones from India, where the tariff is about half as high.

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