Donald Trump intends to radically attract suppliers to localize production in the US during his second term by raising customs duties on imported goods. Asus representatives said that the very transfer of PC component production outside of China would cause their price to rise.
Image source: Asustek Computer
S.Y. Hsu, one of Asustek Computer’s two CEOs, explained on the quarterly earnings call: “As we move production lines to other countries, we need new equipment and testing tools, which cost extra money.” According to the Asus executive, the company will try not only to hold back price increases but also to sacrifice some profits, but at some point, some of the increase will inevitably have to be passed on to end-user prices. Already, some suppliers in the U.S. market are raising retail prices to cover the additional costs. Asus will try its best to limit price increases for customers.
As PCMag notes, the price hikes in American retail are getting worse amid a shortage of GeForce RTX 50 series graphics cards. For example, the Asus ROG Astral GeForce RTX 5090 graphics card debuted on Newegg at $2,799, and now costs $3,359. Considering that the recommended price for the GeForce RTX 5090 is $1,999, that’s quite a markup.
According to Asus management, the company managed to ship an increased stock of goods to the US in the fourth quarter to reduce the impact of new customs duties on Chinese-made products. Currently, they are subject to a 20% rate when imported into the US. The head of the company did not specify where exactly Asus’ orders for the production of products for the American market from China will be transferred, but said that the company’s partners have factories around the world. At the same time, Asus management is generally optimistic about the current year, noting the high demand for GeForce RTX 50 video cards and computers with AI acceleration, as well as the inevitability of the migration of corporate clients from Windows 10 to Windows 11.