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- Graphics card manufacturers are increasing their production in anticipation of potential US tariffs on Chinese goods, despite a current temporary pause in the trade dispute.
- This production increase is focused on more profitable mid-range and high-end models, which could lead to shortages of budget-friendly cards.
- Any new tariffs would likely push prices well beyond official MSRPs.
The tariff issue has calmed down after the recent lull. The Trump administration’s tariff plans have been temporarily paused. However, the situation remains volatile, and as a result, our industry is looking ahead.
Reportedly, graphics card manufacturers want to ramp up graphics card production before the deadline of July 9th to make more money.
The underlying issue of tariffs between China and the US continues to impact businesses and the supply chain. The temporary peace agreement is only a short time to change strategies without knowing what’s coming. That’s why they are ramping up graphics card production, as the move is beneficial for consumers.
The MSRPs set by NVIDIA and AMD are now essentially a joke, as manufacturers operate with such narrow margins. The great majority of graphics card models fall below these prices, and those that can afford them are fortunate. At the absolute least, things will worsen significantly in the US. And after that, they will most likely expand to South Korea, Japan, and Europe.
Nikkei Asia reports that both MSI and GIGABYTE are increasing graphics card production to increase stock availability after the tariffs. Joseph Hsu, the president of MSI, disclosed the strategy to accumulate stock headed for the US to “meet market demand.”
Additionally, since they will be concentrating on the most interesting markets, the mid-range and premium segments, the stock may be higher in these and nearly zero in the other models.
This is a wise strategy, as a large number of graphics cards will sell at a higher price with greater profit under the guise of tariffs.
In any event, manufacturers benefit from increasing graphics card production now, tariffs or not, as consumers will rush to purchase due to fear of price increases.
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