Among the Biggest Losers of Tariffs are Apple, Amazon, and Tesla

Shares of leading American companies, including Apple, Amazon, and Tesla, have dramatically fallen in trading after the stock exchanges closed on Wednesday, following former U.S. President Donald Trump’s announcement of a new comprehensive tariff regime. These new U.S. measures threaten to severely disrupt global supply chains and create uncertainty among investors and entrepreneurs worldwide, reports FT.

Among the most affected appear to be technology companies, with futures contracts tracking the Nasdaq falling by 4 percent. Shares of Apple, which is particularly exposed to additional tariffs on Chinese products, plummeted by 7 percent, while Amazon’s shares fell by approximately 6 percent.

Tariff War Threatens Supply Chains

The escalation of trade brings serious risks to technology supply chains, after executives from major companies have lobbied the president for months to ease or avoid policies that could undermine their profitability. However, technology companies are not the only ones affected. Shares of major retail chains and well-known brands have also experienced a significant decline. Walmart recorded a drop of 7 percent, Target more than 5 percent, while shares of sportswear brand Nike weakened by 7 percent in trading after the stock market closed.

The new tariff regime foresees the introduction of a universal tariff of 10 percent on all countries, starting from April 5. Additionally, from April 9, significantly higher ‘reciprocal’ tariffs will be introduced that will affect trade relations with the European Union, China, the United Kingdom, Japan, and South Korea.

Experts Warn

Daniel Ives, an analyst at investment firm Wedbush, described the new tariff regime as ‘worse than the worst-case scenario’ that markets feared.

– Technology stocks will be under significant pressure due to this announcement, primarily due to concerns about falling demand, disruptions in supply chains, and especially due to the impact on China and Taiwan – said Ives.

The CEO of a major technology company, who wished to remain anonymous, stated that doing business under the Trump administration is like ‘trying to hit a moving target’.

– I am more concerned that he will destroy the American economy than any set of tariffs – added the anonymous source.

Apple did not wish to comment on the possibility of tariff exemptions, although it managed to achieve this during Trump’s first term. A White House spokesperson confirmed that there is currently no exemption for Apple. Apple CEO Tim Cook finds himself in a geopolitically sensitive situation, as the company’s supply chains are strongly linked to China. Specifically, manufacturing giants like Foxconn in that country produce tens of millions of iPhones annually. In February, Apple announced a $500 billion investment plan, which many interpreted as an attempt to appease the Trump administration. Currently, Apple ships about 50 million iPhones to the U.S. market annually, with the vast majority of these devices produced in China. The iPhone still accounts for more than half of the company’s total revenue, while the rest comes from Macs, iPads, wearables, and the growing services segment.

Trump’s decision includes the introduction of a reciprocal tariff of 34 percent on imports from China, along with the existing tariff of 20 percent, and an additional 26 percent on India and 46 percent on Vietnam, a country that has become a key Apple manufacturing hub outside of China.

Amazon, whose founder Jeff Bezos has recently been working intensively to repair relations with Trump, could also suffer serious consequences. Morgan Stanley analysts estimate that a quarter of Amazon’s retail costs are related to Chinese imports.

Tesla Also Affected

Trump confirmed that a 25 percent tariff will be imposed on all cars and parts produced outside the U.S., causing a drop in shares of all American car manufacturers. Tesla experienced an 8 percent decline, as investors fear increased production costs and possible retaliatory measures from other countries. Tesla already warned last month that production costs will rise as ‘certain parts and components are difficult or impossible to source within the U.S.’, which could jeopardize the competitiveness of American cars abroad.

The White House stated that certain sectors, including semiconductors, copper, and certain minerals not available in the U.S., will be exempt from tariffs, but specific details were not provided.

Daniel Newman, CEO of The Futurum Group, described Trump’s new tariffs as ‘a brutal and sudden removal of market illusions’.

– Markets have relied on a globalized economy, and now we see that security crumbling – he said.

The pressure to obtain special exemptions has immediately intensified. The Consumer Brands Association, whose members include giants like PepsiCo, Mondelez, and Kraft Heinz, has submitted a request for exemptions for certain ‘key ingredients’ from the new tariffs.

– We urge President Trump and his trade advisors to more precisely tailor their approach and exempt key raw materials and components to protect manufacturing jobs and prevent unnecessary price increases in stores – stated the Association.