The tariff policy from the current US presidential administration is, uh, fluid to say the least: Shortly after its threat of tariffs across the global economy – even against friendly nations – caused gaming and tech company stock value to slip, the current administration decided to mostly change its mind, offering a 90-day drop to 10% for most countries and focusing instead on attacking China with a 145% levy on goods while Beijing struck back with its own 125% tariff on US goods – all while consumers were left twisting in the chaos.
Now it looks as if the Republican administration has changed its mind yet again: The tariffs on China and some other countries will now exclude specific items including computers, smartphones, and various related electronic components and devices, a large chunk of which are manufactured in China.
The move comes after multiple analysts warned that price hikes would land on consumers in what was classed by one as a “category 5 price storm.” One given example from analysts at the investment bank UBS say the cost of a new iPhone would have added $1,000 to its price if the levies held. The price of PC components such as GPUs and CPUs would have likely seen their own hikes. The maneuvering has also continued to see pricing for the Nintendo Switch 2 remain in limbo and pre-orders for the system paused in the US.
The administration has claimed that this exemption is being granted to ensure that tech companies can move manufacturing of components to US shores, but once again that showcases ignorance of the global economy: One estimation suggests that if Apple would move even 10% of its iPhone manufacturing to the US, it would cost the company three years and $30B – and the price of the end product would end up higher anyway.
With that said, some companies are already cowing to the pressure. Nvidia has said it plans to invest billions in US manufacturing, though the company is also keen to chase its aspirations to continue AI development without “allowing energy to be an obstacle.” So it sounds like it’s less about helping the American workforce and consumer and more about being allowed to build a technological tire fire.
We further point out that the tariff policy of the current US administration has changed multiple times across the past two weeks, and there is no real guarantee that it won’t change again. So really all of this that’s in print now could be different by the next day.
