Microsoft, Sony and Nintendo send a message against the US government to increase tariffs on game consoles
Recently, game console manufacturing giants Microsoft, Sony and Nintendo have jointly submitted documents to the US Trade Representative Office against game console tariffs. Previously, the US government was preparing to impose a 25% tariff on game console products produced in China, which could be a devastating blow to the gaming machine industry. Simply put, this tariff increase will hurt consumers, video game developers, retailers, and host manufacturers, while also stifling industry innovation. Employment also puts thousands of American jobs with high value and high returns at risk, which is a disaster for the entire industry.
Unlike a computer, each game console has custom hardware and design and differentiates functionality, while also using a proprietary platform operating system. The games and services designed for the game console must be designed separately through labor-intensive processes, and even the migration of games requires a lot of effort.
More than 96% of the game consoles imported from the US last year were made in China, and the supply chain has matured through years of investment with partners. A complete transfer of purchases to the United States or other countries can result in severe disruptions in the supply chain and can also result in a dramatic increase in manufacturing costs. And in the case of low-profit margins in the game console, it is expected to continue to raise tariffs, which will have very serious consequences for the game console industry.
In the public statement, the game console giant also said that each game console is composed of dozens of very complex hardware components made in multiple countries. Even individual supplier changes must be carefully reviewed to reduce product quality, reliability, and potential consumer safety risks. The proposed increase in tariffs will cause serious disruption to the game console company, increase the cost, and may eventually affect the sales of the host. Declining sales of game consoles, such as game developers and retailers, will also be devastating, posing a serious threat to the entire gaming industry.
