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Trump’s Tariffs Spark Crisis for Gamers and Industry

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This morning, Nintendo’s announcement to postpone US preorders for the anticipated Switch 2 has intensified concerns regarding President Trump’s proposed import tariffs that could affect millions of American gamers. The Entertainment Software Association (ESA), a key lobbying group representing the gaming industry’s interests in Washington, has raised alarms that the repercussions of these tariffs extend beyond just Nintendo.

“There are many devices that people use to play video games,” stated ESA Senior Vice President Aubrey Quinn in an interview with IGN shortly after Nintendo’s preorder news. “From other consoles to VR headsets, smartphones, and gaming PCs, if we assume it’s just about the Switch, we are not considering the broader implications.”

“This issue transcends any single company; it affects the entire industry,” she added. “The impact will resonate throughout the gaming world.”

Trump’s tariff plan proposes a 10 percent tax on imports from a wide range of countries, but notably includes more severe tariffs of 46 percent on imports from Vietnam and 54 percent on those from China—two major manufacturing hubs for console hardware. Quinn expressed skepticism about the idea that such tariffs will not significantly affect pricing for these consoles.

Furthermore, she cautioned that substantial tariffs could lead to decreased consumer spending, which would ultimately harm revenues, employment opportunities, and investment in research and development within the gaming sector.

“Video game consoles are sold at slim margins to lower barriers for consumers,” explained the ESA on its tariffs issue page. “Increases in tariffs would mean that these added costs would be passed on to consumers, creating a ripple effect that could harm the industry and the jobs it supports.”

Widespread Consequences

Quinn emphasized that the negative effects of the tariffs would not be confined to international companies like Nintendo. “American companies also rely on products that cross borders to assemble their consoles and develop their games. Therefore, the ramifications will be significant, regardless of where a company is headquartered,” she cautioned.

While some may argue that video game companies should relocate more of their production domestically to avoid these tariffs, Quinn highlighted the complexities of supply chains. In an interview with Game File, she remarked that “supply chains are intricate, and changes take time. Any response to such announcements cannot be a swift reaction.”

Last month, Circana analyst Mat Piscatella warned that proposed (and later mostly delayed) 25 percent tariffs on Mexican imports—where the majority of physical video games are produced—could lead to a dramatic drop in the availability of disc-based games in the U.S. Replacing this Mexican production capacity with domestic solutions would require “substantial investment” in a market segment that is already shrinking rapidly, Piscatella noted.

Advocating for Change

Recently, the ESA participated in a multi-industry letter to U.S. Trade Representative Jamieson Greer. The letter asserted that “U.S. tariffs on critical technology imports would harm domestic businesses and jeopardize the nation’s long-term technology leadership.” The communication urged Greer to focus on fostering positive trade relations rather than imposing tariffs.

In 2020, the ESA successfully advocated for an exemption from tariffs on Chinese imports, collaborating with the Consumer Technology Association. Trump has recently indicated that similar industry-specific exemptions could be considered this time around.

Quinn noted that the ESA is currently engaging with officials at the White House and the U.S. Trade Representative’s office. However, she emphasized that these discussions may prove more effective if “more governmental representatives and their staff are made aware of the concerns from their constituents.”

Trump’s Tariffs Spark Crisis for Gamers and Industry
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