WITH long trade war between the US and China continuing its escalation, the Trump administration is now threatening impose a 25% tariff on an additional $300 billion worth of goods from the country. The move would cover almost all Chinese exports. In light of this threat, Nintendo, Microsoft and Sony today published a letter asking the administration to exempt gaming consoles from any such tariff plans.
Seven page letterThe document, signed by the vice presidents of business relations of the three largest console manufacturers, states that any import tax on game consoles “would harm consumers, video game developers, retailers and console manufacturers; will jeopardize thousands of valuable and profitable US jobs; and will stifle innovation in our industry and beyond.”
Because gaming consoles are sold at or slightly above production costs, the cost of any import tariff would have to be passed directly on to “extremely price-sensitive” consumers, the letter argues. “A 25% price increase would likely put a new gaming console out of reach for many of the American families we expect to be purchasing a console this holiday season,” the letter said.
According to a cited study by Trade Partners Worldwide, this would result in a direct loss of $350 million to the US economy each year, as well as a “ripple effect” for third-party accessory and game manufacturers and retailers. Not to mention the potential impact on the 65,000 American workers employed in the gaming industry, the letter states.
