Game consoles will get more expensive because of tariffs

Nintendo Switch 2 game console. Photo: The Verge .

Major Japanese entertainment companies including Nintendo and Sony may raise prices on their game consoles in response to US tariffs, according to Bloomberg Intelligence .

Estimates suggest that the Nintendo Switch 2 and PlayStation 5 with Astro Bot in the US could cost up to 30% more, or $590 .

Both devices are assembled in China, a country that is currently subject to a 125% US tariff on all imports. The Nintendo Switch 2, in particular, is expanding production in Vietnam.

According to analyst Nathan Naidu, home console companies are the most vulnerable in the video game industry, due to their hardware business and physical goods shipping.

Naidu noted that the US market accounts for 29% of Sony's revenue, and 37% of Nintendo's sales. US consumers play a role in driving global trends, boosting demand for entertainment products through word of mouth.

The 30% price increase for the Nintendo Switch 2 is calculated based on the 80-90% tariff on imported goods into the US. However, Nintendo may not be in a hurry to increase prices because it is taking advantage of the 90-day tax deferral to increase imports.

Nintendo’s partner Hosiden has committed to shifting most of its Vietnam-made production to the US since the beginning of the year. Similarly, PC makers have also increased their imports to the US in the first quarter to cope with tariffs.

Nintendo Switch 2 price increase based on tariff scenarios. Photo: Bloomberg .

Nintendo and Sony shares fell 5.4% and 9.4%, respectively, in Tokyo trading on April 11. The volatile price movements reflected uncertainty about tariffs, including questions about the possibility of negotiations and exemption policies, according to Bloomberg .

For Nintendo, the 90-day tariff deferral is an opportunity for the company to resume importing the Switch 2 from Vietnam. However, the company has yet to announce a US pre-order date for the product, which has been postponed indefinitely while it assesses the impact of the tariffs.

If Sony or Nintendo were to raise console prices in the US, Naidu predicted the move could put upward pressure on prices globally.

Nintendo's future depends on the Switch 2 console, which will become the main platform for popular games and characters, while Sony is expected to struggle to maintain sales of its four-year-old PS5 line.

Among the three "big guys" in the game console market, Microsoft can breathe the easiest as it is less dependent on partners that are subject to high US tariffs.

Source: https://znews.vn/switch-2-ps5-co-the-dat-hon-vi-thue-quan-post1545109.html