Tim Cook's power moves

Apple CEO is not taking tariffs lying down.

Back in 1998, Apple was on shaky ground. Steve Jobs had recently returned to right the company, but Apple was still struggling for survival against the mighty Wintel juggernaut.

However, Cupertino was about to launch a colorful new computer with a crazy translucent shell — a machine designed to quickly and easily get onto the internet. It was called the iMac.

Months before the launch, Tim Cook, then Apple's operations chief, made a very big bet. He reserved $100 million worth of air freight for the upcoming holiday quarter — almost the entire capacity of the shipping industry.

It was a big, bold bet. There was no guarantee the new computer would take off. Apple’s products at the time were middling sellers, and the company’s brand was in the toilet.

The gamble easily could have failed, and Cook would have looked rather foolish.

But the iMac G3 became a monster hit. And competitors like Dell and Compaq found themselves unable to book air freight for their wares during that critical holiday quarter.

Cook's foresight ensured that Apple could meet iMac demand, and gimped Apple’s rivals at the same time.

Now, with President Donald Trump’s massive import tariffs looming — which will likely lead to big price hikes — Cook is making similar moves that could cleverly cushion the worst of the damage.

Also in today’s newsletter:

— Leander Kahney, EIC.

A message from the Cult of Mac Deals team

A message from the Cult of Mac Deals team

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One more thing ...

I think the same philosophy that drives the product has to drive everything else if you want to have a great company. Manufacturing … demands just as much thought and strategy as the product. If you don't pay attention to your manufacturing, it will limit the kind of product you can build and engineer. Some companies view manufacturing as a necessary evil, and some view it as something more neutral. But we view it instead as a tremendous opportunity to gain a competitive advantage. [I've thought that] ever since I visited Japan in the early '80s.

— Steve Jobs, 1989.

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