The upcoming inauguration of Donald Trump is unnerving many participants in trade chains even outside the United States, since the future president of the country intends to sharply raise customs duties. Suppliers are trying to deliver more products before Trump takes office, and this in itself contributes to rising prices, even without taking into account future tariff increases.
Image source: NVIDIA
As you know, the bulk of electronic devices are, to one degree or another, assembled in China, and for American customs authorities this will mean that if duties are raised, they will need to impose them on a wide range of electronics. Video cards, for example, will rise in price by about 40%, and in the case of flagship models this will be a fairly significant increase in value terms. In the case of the same Nvidia products, an increase in retail prices in the American market will certainly affect consumers around the world, since the company traditionally sets average recommended prices in all regions of its presence. In fact, the desire of suppliers to bring more products to the United States before January 20 has already caused an increase in transportation tariffs, and they are the same for all market participants, so in this situation, goods will begin to rise in price outside the United States. AMD and Nvidia are preparing to introduce new video cards in the next quarter, but at the end of January, Chinese manufacturers will begin their traditional holidays, so they will try to deliver the maximum number of new video cards to customers by the end of next month for this reason.
According to Taiwanese sources, video card manufacturers were forced to increase production volumes in order to have time to ship them to the United States before a potential increase in duties. In general, as Bloomberg explains, the intensification of logistics in the American direction in recent weeks is typical for many global industries, and attempts by suppliers to import more goods before Trump’s inauguration are increasing costs, which will ultimately be passed on to consumers’ wallets. According to some estimates, laptops in the United States may rise in price by 45% due to tariffs, smartphones will become more expensive by 25.8%, and monitors will increase in price by at least a third. Game consoles will also suffer; they will rise in price by 40%. The specifics of the electronics market are such that the formation of increased warehouse stocks is not always advisable, since products are constantly updated and improved, and none of the sellers ultimately wants to be left with a bunch of outdated hardware. The creation of geographically alternative production chains is also expensive, so products inevitably become more expensive as a result of the introduction of increased customs duties.