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Trump’s Tariffs Could Make Some Gadgets a Lot More Expensive

Photo: AP

When President Trump announced tariffs on imported steel and aluminum (which he later softened), he sent huge segments of the US economy—including the auto, aviation, and construction industries—into a panic. However, it seems those fines were only the start of a new trade agenda that may impose $60 billion of annual tariffs on products imported from China.

The goal, as Trump apparently sees it, would be to help reduce the US’ trade deficit with China, which as of 2017 hit an all-time high of $375.2 billion. As TechCrunch points out, Trump said:

“We’ve lost, over a fairly short period of time, 60,000 factories in our country—closed, shuttered, gone. Six million jobs, at least, gone. And now they’re starting to come back.

[…] The word that I want to use is ‘reciprocal.’ When they charge 25 percent for a car to go in, and we charge 2 percent for their car to come into the United States, that’s not good. That’s how China rebuilt itself.”

While a complete of list of goods the new tariffs may effect has not been published yet (it’s apparently scheduled to be released sometime in the next 15 days), the list is said to target “everything from shoes to clothing to electronics” with a potentially significant focus on the tech industry, according to TechCrunch. Of particular note were recommendations made to the Senate Finance Committee by US trade representative Robert Lighthizer regarding tariffs on products from China’s electric vehicle, high-tech shipping, and aerospace industries.

While the proposed plan doesn’t mention what kind of impact it might have on gadgets like smartphone or laptops, there’s a good chance major Chinese manufacturers such as Huawei (the world’s third-largest phone maker) or Lenovo (the world’s second-largest PC maker) could find themselves at a significant competitive disadvantage. And it’s possible increased costs would be pushed onto US consumers. In a worst-case scenario, using that 25 percent number Trump mentioned above, the price of a fantastic laptop like the Yoga 920, which starts at $1,300, could increase by a whopping $325 to a new starting price of $1,625, effectively pricing Lenovo out of the market.

It’s not clear if the tariffs would affect products like Apple’s iPhones, which are manufactured in China, but then shipped to the US and sold by an American company. Trump could make an exemption for Apple, like he did for imported steel from Europe, Canada, Mexico and other “allies.” However, with Trump having called China an “economic enemy” in the past, there’s really no telling what he’ll do.

Since the vast majority of tech in many of our electronics comes from China, there’s a chance these tariffs will have devices across the board costing more, which is going to be bad for pretty much everyone.

[TechCrunch, New York Times]





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