Tensions with China continue to escalate, something that US President Donald Trump has publically stated he has no intentions of letting die down, and it looks like that upward trend is about to skyrocket. At the beginning of the month, the President opened up about his plans to increase tariffs on imports by a whopping 25%. The tactic's objective is to force China into renegotiations, though many businesses are speaking out about being used as pawns that will most-assuredly suffer by this bold move.
Many video game names, especially Sony and Nintendo, are also included in the businesses that could be hurt by this move, which means it absolutely would affect gamers in a very expensive way. To urge the President to rethink his strategy, Sony, Nintendo, and Microsoft have drafted up a seven-page letter asking for an exception to the proposed tariff changes.
"While we appreciate the Administration's efforts to protect U.S. intellectual property and preserve U.S. high-tech leadership, the disproportionate harm caused by these tariffs to U.S. consumers and businesses will undermine--not advance--these goals," reads the letter addressed to Joseph Barloon, the general counsel to the Office of the United States Trade Representative. "Accordingly, we respectfully request that the Administration remove HTSUS subheading 9504.50.00, covering video game consoles, from the final list of tariffs, and thus refrain from applying tariffs on these products."
The letter also cites the damage this move could make to the American manufacturing industry as well, making it near impossible for local companies to be able to swallow costs for MSRP, especially if all surrounding prices increase in response to this particular strategy.
With the PlayStation 5 and the Xbox Scarlett officially revealed, it would make sense that they have a major stake in overseas trade. Even on a local scale, everything would be impacted in a trickle sort of effect. One point made by our friends over at Game Informer is that if this tariff gets pushed live, the cost of next-gen consoles is likely to skyrocket.