The Blubber

The Consumer Technology Association (CTA) has released new projections on how much more Americans may pay for tech products if President-elect Donald Trump implements proposed import tariffs.

The study examines two potential scenarios: one where a global 10% import tariff is imposed alongside an additional 60% tariff on imports from China, and another where global tariffs increase to 20% with a 100% tariff specifically targeting China.

This follows an earlier CTA report warning that such tariffs could raise laptop and tablet prices in the U.S. by as much as 46%. The CTA, which represents the $400 billion U.S. tech industry and organizes the annual CES conference, emphasizes that tariffs function as a tax on American businesses and consumers.

Impact on Prices and Spending Power

The report analyzed ten product categories, including laptops, smartphones, gaming consoles, monitors, and lithium-ion batteries. It concluded that tariffs would reduce U.S. consumer spending power by $90 billion to $143 billion annually, even accounting for alternative supply sources or potential domestic production. The hardest-hit categories would include laptops, tablets, and smartphones.

• Scenario 1 (10% global + 60% China tariff): Laptop and tablet prices would rise by 45%, gaming consoles by 40%, monitors by 31%, and smartphones by 26%.
• Scenario 2 (20% global + 100% China tariff): Laptop and tablet prices would surge by 68%, consoles by 58%, monitors by 48%, and smartphones by 40%.

Industry Concerns

“The tech sector is America’s economic engine, driving global innovation and job creation,” said CTA CEO Gary Shapiro. “Proposed tariffs threaten the deflationary power of tech in the global economy. Tariffs are a tax on American businesses and consumers. We urge the incoming administration and Congress to prioritize an Innovation Agenda that fosters growth.”

Will Tariffs Bring Manufacturing Home?

Trump’s stated goal is to encourage manufacturers to relocate production to the U.S. However, the report suggests this outcome is unlikely. Instead, production would likely shift from China to other low-cost countries with minimal tariffs. Even if manufacturing moved back to the U.S., the industry would still depend heavily on Chinese suppliers for critical components like lithium-ion batteries, low-spec processors, and high-volume consumer electronics parts.

China has strategically invested to dominate these key sectors, creating challenges for any efforts to localize production entirely within the U.S.