Politico: How Apple prevailed in the U.S.-China trade war

“A meeting with POTUS — it’s a pretty fluid environment. The risk paid off.”

From a joint effort by Politico and the South China Morning Post:

As the Trump administration sends signals about a potential trade deal with Beijing, one iconic American company is poised to emerge from the bruising conflict in a better position than most: Apple.

Under chief executive Tim Cook, Apple has kept its China-manufactured iPhones off the list of Chinese imports that Trump has slapped with roughly US$250 billion in tariffs. That puts the Cupertino, California-based electronics giant in an enviable position compared with other sectors caught in the crossfire – thanks in part to efforts by the soft-spoken, 58-year-old Cook to cultivate leaders in both countries.

In the US, Cook has made a point of directly engaging with Trump, even as the president’s immigration policies and remarks about minorities have scared off other executives from liberal-leaning Silicon Valley. And in China, Cook – who knows some Mandarin – has actively cultivated government and business leaders during his frequent visits to a country where Apple’s supply chain supports an estimated 3 million jobs…

Such engagement marks a sharp contrast with other tech executives. Though there are exceptions like IBM’s Ginni Rometty and Oracle’s Safra Catz, most tech chief executives have distanced themselves from the president out of fear their liberal workforce might revolt. Amazon.com and Facebook, for instance, have generally sent lower-level officials to White House functions. Tesla chief executive Elon Musk and then-Uber Technologies chief executive Travis Kalanick both backed out of presidential advisory roles after backlash over Trump’s policies.

The Apple chief executive’s willingness to meet personally with Trump and his aides, rather than send other executives to deal with the White House, has benefited the company, according to an administration official familiar with the Apple chief’s tactics.

“He’ll take the meeting, and in some regards, take the risk,” the official said. “A meeting with POTUS – it’s a pretty fluid environment. The risk paid off.”

My take: Smart of Cook to learn some Mandarin. Meanwhile, Apple investors, who took the hit when iPhone sales plummeted in China, are still waiting for the risk to pay off.

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One Comment

  1. Mordechai Beizer said:
    I think it’s poor leadership when CEOs think that it’s inappropriate for them to engage with the President because of their fear of not coddling their most outraged employees. I applaud Tim Cook.

    Having said that, Tim Cook with his strong LGBT profile, environmental and privacy stances, etc. is like Nixon in China. No one (credible) was going to question Nixon’s bona fides in going to China nor would anyone question Cook’s in meeting with Trump.

    March 5, 2019

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