Donald Trump has won the presidency and, if he actually goes through with some of his policy proposals, the consequences for gamers will be stark. One of the reasons electronics are so cheap in America is its robust trade relationship with China.
During the campaign, Trump said he’d impose a baseline 60% tariff on Chinese exports. If he does that, the price of all the stuff gamers love is going to go up. Laptop prices could spike by almost 50%. The cost of video game consoles could rise around 40%, making the upcoming PS5 Pro cost almost $1,000. The Switch 2 may be backward compatible, but it may cost quite a bit more than the original.
Trump campaigned on punishing China for a perceived trade imbalance with the United States. It was a winning issue for him in his original campaign, and one he acted on, and he spent time on the campaign trail saying he’d do it again. Trump’s broad plan is to encourage a return of U.S. manufacturing through restrictive tariffs. A tariff is a flat tax on a trade good. Trump’s two big proposals are a 10% to 20% import tariff on all goods from other countries and a 60% tariff on goods from China.
China does not pay the cost of those tariffs. The companies importing the goods from China do. Companies have been clear that if tariffs raise their cost of doing business, they’re going to pass the costs onto the consumer. “If we get tariffs, we will pass those tariff costs back to the consumer,” AutoZone CEO Philip Daniele said on an earnings call in September.
The Consumer Technology Association, the trade association behind CES, published a study in October that looked at the possible effects of a 60% tariff on consumer electronics. It’s important to keep in mind that the study was commissioned by a trade group that stands to lose an enormous amount of cash should the tariff go through on electronics. That said, it’s still a strong indicator of where the industry’s head is at and what it believes would be a worst-case scenario when Trump takes office.
The study looked at ten different consumer tech products: smartphones, laptops, connected devices, video game consoles, and various computer accessories. According to the study, a tariff on electronics from China would have the immediate effect of spiking prices and the long-term effect of driving manufacturing to other countries. Critically though, those other countries would not be the United States. It’s still too expensive to make stuff in America and keep costs down.
“Across the board, the tariffs will cause significant price increases for the U.S. consumer,” the study said. The CTA estimated that laptop and tablet costs would go up 46%, smartphones would go up 26%, and video game consoles would spike 40%. That kind of increase would put the cost of the forthcoming PS5 Pro at just under $1,000. A top-of-the-line GPU, the kind used for AI and gaming, could bloat from around $900 to $1,300. The price of monitors would go up $109, desktops would go up around $74 overall, and headphones could cost an extra $35.
CTA VP of International Trade, Ed Brzytwa, stressed the damage tariffs would have on consumers in an interview with Tom’s Hardware. “Tariffs are regressive taxes that Americans pay. They’re not paid by a foreign government,” Brzytwa said. “They’re taxes that importers in the United States pay and foreign governments and foreign countries do not pay those tariffs. So when I say they’re regressive, it means that they harm poor people and people of little means more than they harm wealthy people.”
Trump’s tariff promise is probably one he’ll keep. During his first term, he imposed tariffs as high as 50% on the country, but tech industry lobbyists successfully carved out an exemption for electronics. It’s impossible to know if they’ll be able to pull off the same feat this time around.
If you were planning on upgrading your PC, building one from scratch or even buying a console, it might be wise to pull the trigger on it before Trump is inaugurated on January 20, 2025. The price after might skyrocket.
gizmodo.com
