PC insiders weigh in on tariffs: ‘Expect pain at the cash register’

If you haven’t been paying attention to the news, heads up—prices for tech gear are shooting up. Tariffs are now in effect for goods imported from China, and they’ve doubled since their original announcement. The U.S. government is now imposing an additional 20 percent tax, instead of 10 percent.

Name any kind of tech device, and it’s affected: laptops, desktop computers, PC components, monitors, smartphones, e-readers, and much more. An overwhelming majority of electronics are produced in China.

Big retailers have already warned about imminent price hikes, with the CEOs of both Best Buy and Target commenting on the breadth and immediacy of the tariff effects. Here at PCWorld, I’ve been wondering specifically about the impact on computers (surprise!)—laptops and desktop PCs are both major interests of our readers.

To answer my own questions—as well as those of readers, friends, and family—I reached out to industry contacts to better understand what these tariffs mean for the cost of PCs…and what to expect in the coming days. Those who responded manufacture laptops, prebuilt desktop machines, and PC components. Much of this information is generally applicable to electronics overall.

The short answer: Expect pain at the cash register. Businesses won’t be able to shield customers from these increases. As Falcon Northwest CEO Kelt Reeves said to me, “[The] PC industry is infamously low margin, so no one can afford to ‘cushion’ 20 percent. Prices already went up incredibly fast on almost every component we buy to build a PC. Stock that was already here vanished, as anything new will be minimum 20% more.” Ouch.

For a fuller grasp of the situation, read on. I’ve broken things down into a series of questions and answers, so you can more quickly find the info you most want to know.

Also, if you’re Canadian, I’m sorry to inform you—this affects you too.

What is a tariff?

First, a quick recap so we’re all on the same page. A tariff is a type of tax that governments impose on goods either entering (import) or leaving (export) the country. They can be fixed or variable, and they apply when goods enter the U.S. Essentially, the tariff must be paid in order for the shipment to be released by customs to the business.

On their face, import tariffs are meant to help protect a country’s domestic industries. Let’s say a country wants to nurture its almond production. It could impose a tariff on imports of almonds from other countries, so that they become more expensive to buy—thus encouraging the purchase of domestically grown almonds instead.

In practice, tariffs can become complicated. Other countries can respond with their own tariffs, kicking off what’s known as a trade war. Economists widely view tariffs as problematic, as they can cause slowed economic growth, damage to domestic industries, and rising costs for consumers without much return benefit.

What are these tariffs?

On February 1, 2025, the executive branch of the United States government announced tariffs on imports from Canada, Mexico, and China, to take effect on February 4. The tax was set at 25 percent for Canada and Mexico, with a lower 10 percent levy on Canadian energy resources (e.g., gas). For China, the rate was set at 10 percent.

On February 4, the import tariff for China began. Those for Canada and Mexico were delayed to March 4.

On February 27, the U.S. government announced an intention to raise the tariffs on Chinese imports to 20 percent.

On March 4, the higher tariffs for Chinese imports kicked in, as did the original tariffs for Canada and Mexico. However, the levies on Canadian and Mexican goods were later delayed again (and remain so at this article’s publishing).

You can read this ABC News overview to see the full timeline for these tariffs, but the basic takeaway here is that tariffs started affecting Chinese products on schedule. Accordingly, prices already began rising on tech gear a month ago, but will jump even higher now.

Which tech devices are affected by these tariffs?

These tariffs are particularly unusual in that they broadly apply to all imports from the named countries. Previous tariffs during the last Trump administration hit more selectively.

When I spoke with SilverStone, a Taiwanese vendor that manufactures an array of hardware for PC building, a representative from their U.S. office emphasized this point, saying, “Almost everything we sell are affected: cases, power supplies, coolers, fans, cables, expansion cards, adapters, etc.” Last time, the impact fell primarily on power supplies.

So a overwhelming majority of electronics are affected—most companies have their devices and/or hardware produced in China. Those imports are all subject to the additional 20 percent tariff.

Additionally, products made in the United States could be affected as well. If a domestic company can’t find an alternative source for materials or components made in China, the cost of those items will rise now, too.

These days, most things we buy are global products—far fewer are made top to bottom within a single country. That’s especially so for anything related to tech.

Are only U.S. residents affected by these tariffs?

Nope. If you live in another country, but are purchasing through U.S., the cost increases will spread to you, too.

For example—SilverStone’s U.S. office said to me that because Canadian customers buy through its U.S. office, they have to pay the higher price as well. (Sorry, Canada.)

However, some companies may be able to still keep costs down for other international customers, so long as they can export directly to their other offices across the globe. If you live outside of the U.S. and know (or suspect) what you’re purchasing could route through the U.S., you may want to look at alternative territories you could buy from.

Are the price hikes equal to the size of the tariffs?

Not necessarily. 

When the tariffs first were announced, Acer’s CEO described their effect as “straightforward” on the retail price of laptops—a direct 10 percent jump. 

In contrast, just a month later, I couldn’t get a precise percentage from most people I spoke with. Many avoided naming any figure. For example, a source who asked to remain anonymous said only, “Price changes will vary based on components and market demand, but we’re doing our best to minimize the impact and are exploring strategies to mitigate these effects.”

The ones who did give numbers generally used a range, because the calculus is so variable. The spokesperson from SilverStone’s U.S. office told me Chinese-made products will “increase on average of 12 to 18 percent” from their current selling prices. (The company plans to raise prices starting next Monday, March 10.)

Meanwhile, as I noted at the start of this article, U.S.-based Falcon Northwest believes that the hardware it buys for its custom PCs will start at a minimum of 20 percent more.

Why the differences in response? SilverStone sells its computer components primarily to partners, like retailers. Falcon Northwest sells fully built PCs (both laptops and desktops) to consumers.

Basically, the ultimate price effects we’ll see as consumers is a mix of:

• How much of the product is made in China
• The relationships the vendors have with their partners
• The retailer’s ability to absorb part of the tariffs

Why can’t the companies absorb these costs?

As mentioned above, the PC industry is considered “low margin.” For consumer gear, profit made on components can be as low as single-digit percentages, and often don’t extend above 20 percent. 

Think under 10 percent for motherboards, and 10 to 15 percent for power supplies. These numbers climb a bit for premium hardware, but not enough to ever rival the margins seen in, say, software. There, you can see as much as 70 to 80 percent.

Without a big cushion, companies can’t cut deeply into their profits to shield customers (be they consumers or fellow businesses) from the tariff hikes. The higher costs get passed on more directly.

That said, multiple industry contacts said they’re working to spread the hit and lighten the load on consumers. Tech vendors know that increased prices mean fewer sales. My anonymous source told me they’ve already seeing sales slow and are trying not to pass on more any costs than necessary, saying, “We only raised prices to cover the tariffs we’ve paid.”

That’s another important detail—these companies must pay these tariffs to get their products onto U.S. shores. They can’t sell anything otherwise. The same anonymous contact said to me, “As importers ourselves, we have to pay the tariffs upfront.” They can’t float the cost until sales happen.

As for the retailers we buy from, you may see some variation in price due to their operating costs and margins. But it doesn’t sound like consumers can expect much help on that front, given those stark warnings made by Best Buy and Target’s CEOs about price increases.

When do prices increase? Will it happen all at once?

The first round of tariffs on Chinese goods went into effect on February 4, at 10 percent. The leap to 20 percent began this past Tuesday, on March 4.

How fast that’ll be felt depends on the product. If a retailer has a decent amount of stock brought to the U.S. before the tariffs started, then their prices may not rise just yet. Most industry contacts I spoke with avoided naming an exact timeline, but SilverStone’s U.S. office estimated the ramp-up period could extend until April.

However if there’s little stock left in the channel, then the price jump may be immediate.

Are there any other price increases coming?

Potentially. In mid-February, President Trump announced an intention to impose a 25 percent tariff on semiconductors as soon as April 2, with the intent to continue to raise the rate “substantially higher over a course of a year.” Such a move would impact PC CPUs and GPUs.

Specific countries subject to this import fee have not yet been revealed. But if the tariff becomes applied broadly, chips shipped from fabrication plants in Taiwan, South Korea, Japan, and other locations will be subject to that hefty new tax—not just those from China.

Will prices come down if the tariffs are dropped?

Costs often stay higher once tariffs are enacted. My SilverStone contact confirmed this when asked about any price reversals should tariffs end, saying, “As to your question on reversing prices, that’ll happen more slowly than it is to raise prices. As a business, we have to be careful with reducing prices across our product line.”

Remember, even after a tariff lifts, any stock that arrived in the U.S. during the tariff still carries a higher cost to a manufacturer or vendor. And due to the lower margins of PC hardware, they are still limited in how much of said cost they can absorb on behalf of the consumer.

Basically, costs can come down, but don’t expect to see any shift until the channels clear of previous stock. Even then, if the chance of future tariffs looms, companies will have less logistical and financial incentive to cut prices.

How big is the impact on laptops and desktop PCs?

Between the comments made by the CEOs of Acer and Falcon Northwest, you could assume a 20 percent increase at minimum. 

Such an even application would put a serious dent in consumer buying power. If you apply that 20 percent as a straight increase, here’s what the prices would look like for laptops that PCWorld has reviewed just before the tariffs:

You’ll pay $100 more now for a previously $500 laptop after this new tariff. In that price range, that’s a sizable increase and can push a machine out of someone’s budget.

On the flip side, other sources declined to state a figure, and I’ve yet to receive comment from large corporations like Dell. We likely have to wait for time to tell—much is up in the air, as I was repeatedly told.

How big is the impact on PC components?

The answer to this question is more complicated than for laptops and prebuilt desktop PCs. Component vendors sit more in the middle of the chain that leads to a computer you can sit down and use. As I covered above when discussing price, the specific impact will vary.

Besides cost, consumers should also be prepared for less availability of parts. One contact told me that a “pressing concern is that several major AIB partners are reducing shipments to prevent costly overstock.”

Basically, higher prices on hardware often means less interest, and no one wants to be left with excess stock they can’t sell.

What hidden effects will the tariffs have?

Besides ongoing price chaos, DIY builders should prepare for possible longer wait times to acquire parts. Likewise, those buying a prebuilt desktop PC made from off-the-shelf components may need more patience as well.

Also, as Falcon Northwest said to me, list prices (MSRP) for components will likely become even more aspirational. Street prices will fluctuate as businesses continue to respond to unpredictable changes to U.S. economic policy—and if availability reduces, demand could cause even higher leaps in cost.

Why can’t companies give more concrete answers?

More than one person I spoke with referenced the tariff situation using words like “uncertainty,” and “unpredictability.”

The short of it is, businesses are scrambling to react to these policy changes. Remember, the 20 percent tariff on Chinese-made goods was only announced on February 27th, just three days before it took effect. The tax’s size and its abruptness caused a lot of disruption.

So right now, companies are still working out their responses to the tariffs. Discussions with partners and reassessing both financial and logistical impact takes time. An additional wrinkle is that vendors don’t know what to expect in the future, which complicates planning.

Kelt Reeves, the Falcon Northwest CEO, says, “This is just a chaotic climate to try and run a business in.”

Will vendors stop producing goods in China?

Some companies intend to shift production across borders. AsRock, which produces PC components like motherboards and graphics cards, has gone on record with its intention to move manufacturing to other countries. 

But that production may not go very far. My contact at SilverStone’s U.S. office said that a couple of its power supplies are made in Vietnam, and the company “will continue to transition more in the future.”

However, the extent of the transfer won’t become apparent for a while—with the sheer amount of manufacturing China does, ramping up in alternative nations can’t happen overnight. For example, 90 percent of SilverStone’s products are made in China. Facilities that can handle the capacity for a wide-scale switch will take time.

Can’t the U.S. just produce electronics on domestic soil?

In a word, no. The infrastructure doesn’t exist—for now.

The Biden administration did begin the U.S.’s attempt to reduce its dependence on China for production of key electronics, namely processors. The CHIPS and Science Act of 2022 set aside $280 billion to facilitate the building of new chip foundries on U.S. soil. 

However, building such facilities takes time, and their ability to ramp up output also can’t happen immediately. TSMC’s new Arizona fabrication plant is already booked out until 2027. And more importantly, domestic production may never get a chance to take off—President Trump just proposed killing the CHIPS act, which would gut its funding. That could delay or even suspend the overall effort to ramp up the US’s self-sufficiency.

Editor’s note: This article originally published on March 7, but was updated with additional info and clarifications.