Apple(US:AAPL) Haitong Securities International·2025-04-08 02:19Investment Rating - The report assigns an "Outperform" rating to several companies including Xiaomi Group, Lenovo Group, BYD Electronics, and Hesai Technology, while Sunyu Optics and AAC Technologies are rated as "Neutral," and Xinyi International is rated as "Underperform" [1]. Core Insights - The report analyzes the impact of Trump's "Reciprocal Tariff" policy on the technology value chain, highlighting that the new tariffs impose a 10% minimum baseline tariff on imports from over 180 countries, with China facing an additional 34% tariff, leading to a total tariff of 54% [4][10]. - The tariffs are expected to create systemic shocks in the consumer electronics industry, particularly affecting pricing and profit margins, with companies like Apple likely to pass on costs to consumers, resulting in significant price increases for products like the iPhone [29][41]. - The report discusses the strategic responses of companies to mitigate the impact of tariffs, including supply chain adjustments and potential lobbying for tariff exemptions [38][39]. Summary by Sections Section 1: Comparison of Trump's Tariff Policies - Trump's first term saw approximately $370 billion in tariffs on Chinese imports, with rates ranging from 7.5% to 25%, aimed at reducing trade deficits and encouraging manufacturing to return to the U.S. [8]. - The second term's tariffs are more aggressive, with a broader scope and higher rates, significantly impacting the global trade landscape [14]. Section 2: Impact on the U.S. Market - The new tariffs are expected to increase costs across various sectors, particularly in cloud services and data center construction, with projected cost increases of 12-23% for data center projects due to higher material costs [16][22]. - The semiconductor industry faces challenges, with a heavy reliance on imports from Taiwan and South Korea, which are significantly affected by the tariffs [19][21]. Section 3: Impact on the Chinese Market - The report outlines China's strategic countermeasures, including tiered tariffs on U.S. energy and agricultural products, and export controls on strategic resources like rare earths [5][11]. - The tariffs are expected to exacerbate the trade tensions and impact various sectors, including renewable energy and textiles [5][11]. Section 4: Consumer Electronics Sector - The consumer electronics sector is projected to face significant profit margin pressures, with companies like Apple expected to increase prices by an average of $123 per iPhone due to the tariffs [29][37]. - The report highlights the potential for a shift in consumer behavior, with increased demand for lower-priced alternatives as a response to rising prices [44]. Section 5: Home Appliance Industry - The home appliance industry is experiencing severe supply chain disruptions and cost increases, with companies like Whirlpool facing challenges in maintaining competitive pricing while managing tariff impacts [39][40]. - The report notes that U.S. manufacturers are accelerating supply chain adjustments to mitigate tariff impacts, including shifting production to Mexico and investing in local manufacturing [43][45].