People have a lot of questions about what a second Donald Trump presidential administration will look like, and one of the big concerns surrounds proposed tariffs on foreign imports, with larger ones targeted for China. If these are passed, it could signal a big change in how video game hardware and software is manufactured and could lead to increased costs for players.
Digital Trends spoke to analysts about the potential impact that tariffs could have on tech like game consoles. As of this writing, the proposal is to implement a 10% or 20% tariff on all imports, but a specific 60% tariff on Chinese imports. Some analysts we reached out to declined to comment on the impact of the tariffs because while Trump has discussed a plan, it hasn’t gone into effect and might not. Others, like Serkan Toto of Japanese games industry consulting firm Kantan, warned that consumers could be the ones paying the cost if plans go into effect.
“The effects would be devastating for game fans,” Toto tells Digital Trends. “China would not pay for this, the U.S. consumer would.”
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According to an October report from the Consumer Technology Association (the organization that runs CES annually), tariff increases on just PC peripherals, video games, and other electronics like smartphones would “reduce American consumers’ spending power by $90 billion.” Since a lot of the products in the video game and electronics industries are manufactured in China, the tariffs would impact most, if not all, products people could buy.
In terms of specifics, the CTA says video game console prices would go up by 40%. Toto estimates that the PlayStation 5 could cost $800 instead of $500, “and the price of the typical $70 game would jump to $112.” The last time then-President Trump imposed 25% tariffs on Chinese imports, GPU prices were expected to skyrocket, with something like the Nvidia GeForce RTX 3080 going from $699 to $874 before sales tax.
It’s likely you’re thinking about the Nintendo Switch successor in this hypothetical. While the tariffs wouldn’t impact the production or supply lines in terms of stock of consoles, which happened during the pandemic, it’ll still cost more for users to buy once it releases, whenever that happens.
Even beyond PC components or video game consoles, the National Retail Foundation says that the proposed tariffs would cost Americans “between $46 billion and $78 billion per year.” The Peterson Institute for International Economics estimates that amounts to around $2,600 per year per American.
But again, these tariffs might not go into effect in this form (something will likely be implemented considering Trump imposed tariffs during his last term through executive action and doubled down on it during his campaign). Plus, there is a lot companies can do to fight back.
According to CBS News, many companies are already looking to move manufacturing out of China. There’s also the possibility that there could be exceptions on certain products. Toto provided an example: “Trump will know that iPhones, for example, are made in China and India. Will Americans really appreciate an iPhone suddenly costing $1,600 instead of $1,000?”
The last time Trump implemented tariffs, the CTA also partnered with the big three console manufacturers — Microsoft, Sony, and Nintendo — to successfully oppose them and force the administration to create exemptions for popular tech. So, it’s not a done deal for video game consumers, who already dealing with increasingly expensive consoles and games.