Trying to understand an error in Python

I don’t need to solve this problem, but to understand how Python thinks about a particular keystroke error I made.

So, I was trying to create a dictionary of characters in a string.

str1 = "Apple"
di = dict()

for char in str1:
    count = str1.count(char)
    di[char] += count

The code is incorrect because I have an iterator in the second to last line.
Python responded like this:

Traceback (most recent call last):
  File "c:\Users\Admin\Desktop\Desktop\PY4E\fcc_py\", line 6, in <module>
    di[char] += count
KeyError: 'A'

Now, KeyError means that a dictionary item could not be found.
I’m unsure how that error comes from a mistakenly placed iterator.
The way I understand it I am trying to add two unlike items: an integer and a key/value pair. In that case, the first charactyer ‘A’ would not be found because the two elements I’m trying to add are not copacetic.
Am I way off?

+= will try to get the value of di[char]. Since at the start di is empty, there’s no char key in it and KeyError is raised.