U.S. Tariffs on Chinese Goods Could Drive Up PlayStation Prices

With tariffs on Chinese goods and game consoles still looming, Sony's CFO says the company might have to respond with hardware price increases.

Sony's Chief Financial Officer, Hiroki Totoki, recently told The Wall Street Journal that Sony might have to raise PlayStation hardware's price — including the PlayStation 4 — should the U.S. impose tariffs on Chinese-manufactured goods.

As always with the WSJ, the article is behind a paywall, but the folks at Gamasutra provided a summary for those without a subscription.

Despite Nintendo, Microsoft, and Sony submitting a formal letter requesting video game hardware be excluded from the proposed tariffs last month, there's still no word whether the request will be accepted. In fact, there's not really much hard information about whether the tariffs will be approved at all, so much of this is still speculation.

In the letter, executives from the three companies explained the potential negative consequences for the games industry and the national economy on whole should tariffs be imposed, and Totoki's cautionary statement about increased prices supports that initial claim.

It should be noted that Totoki's statement is just that right now — a statement. He said Sony hasn't decided for certain what will happen if the tariffs are imposed, but Sony would need to take actions ensuring its business remains profitable.

Unlike with Nintendo, those actions apparently can't include moving production out of China. The proposal letter said costs of production outside China would be prohibitively high, and it would seem from Totoki's statement that Sony isn't pursuing manufacturing in other countries, despite persistent rumors to the contrary.

If Sony did raise prices, then it would naturally mean PlayStation 4 prices go up, to say nothing of how it might affect Sony's still-mysterious next-gen console.

While so far it's only one company discussing price increases, Sony has shipped more than 100 million PS4 systems since the console launched. Thus, any changes in the product chain will naturally ripple out and affect consumers, retail businesses, and countless others involved with Sony's hardware and software business.

Contributor

Josh Broadwell's gaming career began early--1993, to be exact--when he was introduced to the Super Nintendo and Super Mario World. Despite all the magnificent games the SNES and, later, the original PlayStation had to offer, it wasn't until the GameBoy Advance era that he finally discovered RPGs, which quickly became a favorite genre. He holds a BA in history, an MA in history, and is currently pursuing an MA in strategic communication.

Platforms Playstation 4
Published Jul. 31st 2019

Cached - article_comments_article_63534
Related