In May 2025, former U.S. President Donald Trump once again turned his sights toward the global smartphone industry. This time, he targeted major manufacturers—most notably Apple and Samsung—demanding that any devices sold in the United States be produced on American soil. In a Truth Social post, Trump explicitly instructed Apple’s Tim Cook that “iPhones … sold in the United States of America will be manufactured and built in the United States, not India, or anyplace else.” He added that “it would be also Samsung and anybody that makes that product, otherwise it wouldn’t be fair.” Beneath the rhetoric, however, lurks a far-reaching economic ripple—one that stands to inflict far more damage on Vietnam than on the U.S. consumer.
The U.S. Angle: Higher Prices, Smaller Impact
At first glance, tariffs on foreign-made smartphones appear self-defeating for U.S. consumers. A “Made in USA” iPhone—built entirely in America—could cost upwards of $3,500, compared to roughly $1,199 for an iPhone 16 Pro at existing production costs. Even absent tariffs, shifting manufacturing back to the United States would raise labor expenses dramatically. If a 25% import duty were applied to Samsung phones, for example, American buyers would confront significantly steeper sticker prices, dampening overall demand.
Those direct hits on U.S. consumers, however, represent only a sliver of the broader picture. After all, the U.S. economy is large and diversified; consumers would likely absorb higher smartphone costs, along with incremental moves toward onshore assembly. In contrast, Vietnam—a country whose export-led growth hinges on electronics manufacturing—could face an economic crisis if Trump’s tariff proposals were to materialize.
Samsung’s Vietnamese “High-Tech Cities”
Samsung stands as Vietnam’s largest foreign investor and exporter, a distinction cemented over more than three decades of expanded operations. Since 1989, the South Korean conglomerate has poured over $22 billion into multiple manufacturing plants, research-and-development centers, and support facilities across Vietnam. Two of its most prominent complexes sit in northern Vietnam:
- Bac Ninh Province (Yen Phong Industrial Park). This sprawling campus houses semiconductor and display production lines, along with final assembly facilities for flagship Galaxy smartphones.
- Thai Nguyen Province (Yen Binh Industrial Park). Designed as a “high-tech city,” this site employs both direct plant workers and tens of thousands of indirect laborers in local supply chains.
Combined, these factories have created well over 100,000 direct jobs. In fact, Samsung Vietnam has reported that its Thai Nguyen complex alone has generated roughly 150,000 direct and indirect positions over the last decade. Beyond smartphones, Samsung’s Vietnamese footprint spans memory chips, OLED and LCD panels (courtesy of Samsung Display), and a range of consumer electronics manufactured in Ho Chi Minh City.
Production Scale
Industry analysts estimate that Vietnam produces nearly 60% of Samsung’s annual smartphone volume—out of about 220 million devices worldwide. In practical terms, this means Samsung’s Vietnam operations assemble around 100 million smartphones per year in just a few high-output plants. In 2024 alone, Samsung Vietnam exported an estimated $54.4 billion worth of goods, mostly mobile phones and component parts.
These electronics exports represent a cornerstone of Vietnam’s overall export economy. In 2024, electronics (including mobile phones, computers, and other consumer devices) accounted for approximately $126.5 billion—about one-third of Vietnam’s total exports. No single company contributes more to that figure than Samsung.
Vietnam’s Trade with the United States
Vietnam’s trade surplus with the United States has grown to historic levels, largely thanks to the electronics sector. In 2024, U.S. imports from Vietnam reached roughly $142 billion, up from $119 billion in 2023. Electronics dominate that figure: of the $126.5 billion in Vietnamese electronics exports, a significant share is bound for the U.S. market.
To illustrate:
- Mobile Phones. In 2023, the U.S. imported about $8.1 billion worth of mobile phones from Vietnam, with Samsung devices claiming a large slice of that pie. (Samsung consistently ranks as the No. 2 smartphone brand in the U.S., second only to Apple.)
- Overall Electronics. U.S. demand for laptops, tablets, circuit boards, memory chips, and household appliances further cements Vietnam’s position as a critical nexus in the global technology supply chain.
Taken together, U.S. electronics imports from Vietnam sustain hundreds of thousands of Vietnamese jobs—ranging from factory floor positions to roles within suppliers that produce casings, printed circuit boards, camera modules, and other essential components.
Tariffs in Play: 25% on Samsung, 46% on Vietnam
Trump’s May 2025 proposal called for a 25% tariff on Samsung smartphones imported into the United States. In addition, he revived a previously announced 46% tariff on a broader range of Vietnamese exports—an acceleration of earlier threats. Although the 46% duty remains paused, the mere specter of such steep levies has unsettled Vietnamese industry leaders.
Immediate Consequences for Samsung Vietnam
- A 25% tariff on Samsung phones would directly inflate costs for U.S. retailers and consumers, causing a sharp reduction in demand.
- Samsung executives have publicly acknowledged confusion over the tariff magnitude, warning that they would be “primary victims” if the duties took effect.
- In Samsung’s Q1 2025 earnings call, management confirmed active discussions about relocating some production outside Vietnam to mitigate tariff exposure.
Strategic Relocation Options
- India. India’s proposed tariff on Samsung phones is 26%—substantially lower than Vietnam’s 46%. Rumors already circulate that Samsung has begun “talks with Indian EMS players” to move a portion of U.S.-bound smartphone output to its local plants. Given existing investments in India (including partnerships with Foxconn and Wistron), this shift could be implemented more quickly than building new capacity from scratch.
- South Korea. Repatriating certain high-end production lines to South Korea would allow Samsung to absorb tariff costs more comfortably, albeit at higher labor expenses than Vietnam.
- Mexico. Some suppliers and contract manufacturers are eyeing Mexico—benefiting from its proximity to the U.S. market and trade incentives under the USMCA (United States–Mexico–Canada Agreement).
Each of these relocation paths entails significant capital expenditure and months (or years) of ramp-up time. In the interim, Samsung’s Vietnamese plants would continue to feed U.S. demand, leaving them vulnerable to any sudden tariff implementation.
The Economic Toll on Vietnam
Vietnam’s growth over the past decade has hinged on foreign direct investment (FDI) and export-oriented manufacturing. Electronics account for a lion’s share of that success:
- Direct Employment. Factories like Bac Ninh and Thai Nguyen collectively employ hundreds of thousands of Vietnamese workers.
- Indirect Jobs. Small and mid-sized suppliers produce everything from screen glass to precision metal parts—sectors that would contract sharply if Samsung scaled back.
- GDP Impact. VinaCapital’s chief economist recently warned that, in a worst-case scenario, Vietnamese GDP could shrink by nearly 2% due solely to the high tariff threat. This estimate does not yet factor in an additional 25% duty on smartphones.
Because Vietnam’s economy remains highly dependent on export performance, any slowdown in electronics orders could ripple through multiple layers of the supply chain. Local parts makers, logistics providers, and even commercial real estate (serving industrial parks) stand to suffer. Early indications of “panic” have already surfaced among South Korean-led enterprises operating in Vietnam; some factories have reportedly begun contingency planning, and a handful of expansion projects in Bac Ninh have been shelved indefinitely.
Trade Data Reflects the Stakes
A closer look at Vietnamese trade figures underlines the stakes:
- U.S. Imports from Vietnam (2024): $142 billion (up 19% from 2023).
- Vietnam’s Trade Surplus with the U.S. (2024): Over $123 billion—among the largest bilateral surpluses for any country.
- Electronics Exports (2024): $126.5 billion (≈ 33% of total Vietnamese exports).
- Samsung Vietnam’s Shipments (2024): Approximately $54.4 billion in goods, mainly smartphones and key components.
If a substantial portion of Samsung’s U.S.-bound production were rerouted to India or Mexico, Vietnam’s electronics exports could decline by $15–20 billion in the first year alone. Some think tanks caution that Vietnam might lose up to 15–20% of its U.S. export market share if high tariffs were imposed permanently.
Broader Implications: Jobs, Investment, and Growth
Beyond the immediate export losses, high tariffs carry longer-term consequences:
- Job Cuts in Manufacturing Hubs. Factories in Bac Ninh and Thai Nguyen could downsize, directly affecting hundreds of thousands of workers.
- Supply-Chain Realignment. Vietnamese suppliers (e.g., PCB assemblers, injection molders, cable manufacturers) would see their order books shrink. Many of these smaller companies lack the capital to pivot quickly to new markets.
- Foreign Investment Slowdown. Uncertainty over tariff regimes already prompted Samsung’s suppliers to reevaluate new plant proposals. If FDI growth stalls, broader industrialization plans could slow, undercutting economic diversification.
- Currency and Fiscal Stress. Reduced export earnings could weaken the Vietnamese đồng, making imports more expensive and exacerbating inflationary pressures. The government’s budget—heavily reliant on export-related tax revenues—might also tighten, pressuring social spending.
Taken together, these factors could shave off a couple of percentage points from Vietnam’s GDP growth rate. In past years, Vietnam has averaged around 6–7% annual growth; even a modest 2% contraction would represent a dramatic reversal, pushing social indicators like urban unemployment and household incomes into jeopardy.
What Lies Ahead?
For Trump and his supporters, the primary goal of raising tariffs is to incentivize reshoring of manufacturing—creating American jobs and curbing reliance on foreign supply chains. In practice, however, the quickest path to evading prohibitive duties runs through India, Mexico, and South Korea, rather than returning to the United States.
For Vietnam, the looming threat of unilateral tariffs underscores a vital lesson: overreliance on a single partner—in this case, Samsung—poses systemic risk. Diversifying the industrial base (for instance, by nurturing domestic automakers or medical device producers) could help cushion future shocks. In the short term, though, Vietnam must weather a period of heightened uncertainty. Depending on how quickly Samsung and other multinationals can retool production footprints, Vietnamese factories may face months—if not years—of disrupted orders.
If Trump’s 25% tariff on smartphones and the 46% duty on broader Vietnamese exports were ever enforced simultaneously, the immediate economic fallout for Vietnam could be severe: lost export revenue in the tens of billions of dollars each year, accompanied by large-scale job losses and stagnating foreign investment. Even if the U.S. eventually rolls back these measures, reputational damage may linger—convincing some global brands to hedge their bets by relocating production beyond Vietnamese borders.
Conclusion
In theory, tariffs are blunt instruments designed to protect domestic industry. In reality, they create global distortions—most acutely felt by small, export-dependent economies. Vietnam’s meteoric rise over the past two decades has been powered by companies like Samsung, which have built entire “high-tech cities” along the Red River Delta. A 25% U.S. import duty on Samsung’s Vietnamese-made phones would threaten that entire ecosystem, imperiling hundreds of thousands of jobs and upending Vietnam’s export-driven growth model.
Ultimately, the question is whether Vietnam’s government and private sector can diversify fast enough to mitigate these risks. As Samsung and its suppliers explore alternative manufacturing bases, Vietnam will need to accelerate efforts to broaden its industrial portfolio and deepen trade ties with other partners. Otherwise, the country may find that the true cost of being so deeply integrated into the U.S. electronics market is far higher than grassroots observers ever anticipated.