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PC and Component Prices to Rise in the US

By Rachel Taylor
13 December 2018

PC and component prices are set to further rise in 2019 according to many computer providers and manufacturers. Thanks to the Trump administration’s imposition of a 10 percent tariff, prices for whole computers and components have risen in 2018. Not that it affected the heavy margins of both Apple and Microsoft but smaller computer retailers are struggling to find solutions to shield their customers from the bad news.

Last September, the Trump administration slapped another 25% tariff on goods coming from China. This new measure however will prove quite harmful to the tech industry in the coming months as most PC and electronics manufacturers rely heavily on parts and whole units manufactured in China. For now, computer manufacturers and providers are stockpiling on units already imported from China under the previous 10% tariff. A percentage they have already struggled to absorb as much as they could. Apple and Intel have been most vocal in their intention to stop the recent 25% proposal but were ultimately unable to sway the administration.

“Our concern with these tariffs is that the US will be hardest hit, and that will result in lower US growth and competitiveness and higher prices for US consumers… Because all tariffs ultimately show up as a tax on US consumers, they will increase the cost of Apple products that our customers have come to rely on in their daily lives, “

– Apple

The tariffs apparently include intermediate electronic goods such as spare parts and accessories so US companies that import their finished goods from China are not as affected. Those same companies however, like Apple, that have to import those parts they manufactured in China will have to transfer those costs to consumers that need to have their Apple devices repaired. Other PC and electronics companies that do their assembly in the United States from Chinese made parts will bear the brunt of these tariffs.

“These tariffs will increase the cost of all of our products and we will no longer be able to stay competitive… In our company’s 20-year history, the proposed Section 301 Tariff Action is the greatest threat to our company’s survivability to ever arise… As a small business, we are already facing tremendous pressure from large global manufacturers like HP/Dell/Apple, which has a greater capacity to absorb these increased costs from the new tariffs”

– CyberPowerPC, LA-based custom computer company

Next year, PC Gamers will have to shell out more exorbitant amounts than what they already pay for graphics cards, PC cases and cooling solutions, all of which are included in the new tariffs or otherwise settle for off-the-shelf gaming rigs and laptops.

The overall goal of the Trump administration is to bring manufacturing back to the United States and away from China. What manufacturers will be left with is to transfer manufacturing to other countries like Taiwan, Malaysia and even Mexico which could take much time and the option is available only to heavy-hitters like Apple and Dell. Smaller manufacturers who do manufacture in the states but rely on imported parts do not have that luxury, thus the tariffs are having an opposite effect. Is the Trump Administration gunning for the long term? It would only be feasible if he wins a second term, otherwise the tariffs could get reversed.

Stockpiles of pre-tariff imported parts are expected to last until January 2019. Gamers set on assembling their latest gaming PCs are urged to scramble for parts before the end of the year. The same goes for individuals and companies that make use of custom PCs and servers or those that need new accessories. The coming holidays will be their final option.

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PC and Component Prices to Rise in the US

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Rachel Taylor

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