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This week we saw the United States government implement hikes to tech tariffs that are already having flow on effects to the greater industry, including some big players from Japan. The tariffs are set to target products built in lower cost countries like China and Mexico that are then sold in the United States. According to Reuters, as a response, Japanese companies Sony and popular drinks maker Suntory (responsible for Boss coffee among others) have started stockpiling inventory in the USA.
The tariffs put in place a minimum 25% tax against products made in Mexico and China, as well as the potential for further tariffs including a proposed 100% tax on chips coming out of prolific silicon makers, Taiwan. These changes have hit tech companies hard with Nvidia reporting a $200 billion valuation loss in a single day. Of course this will all likely come down to the consumer, with retail bosses from Best Buy and Target already predicting price increases to end users.
In the new tariff talks, President Trump accused both China and Japan of undervaluing their currencies, causing an unfair situation for manufacturers located within the United States.
The President stated that further tariffs against these countries was the simplest solution. This statement has seemed to highlight these countries, and Japanese companies appear very aware of being targeted.
This could all come as a huge blow to the Japanese tech industry. Due to its shrinking population, Japan relies heavily on export, especially to the US. With some like Sony stockpiling, it could mean consumers in the United States will be more likely to see older and outdated variations of tech—and some stale cans of coffee—along with price hikes.
Reuters also lists several instances of Japanese companies, such as like Honda, looking to increase production in the United States to get around the tariffs.
The new tariffs are already heavily impacting the future of tech, and it’s only early days yet. Most aren’t expecting the outcome to be good for consumers, and especially gamers. The Entertainment Software Association is the trade group representing videogame publishers in the US, has issued a statement saying the move is likely to do serious harm to the game industry and gamers alike.
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Kurt Indovina
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