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Tariffs directly influence your expenses, but the degree to which they affect prices depends on the specific products in question and the availability of alternatives. Some sellers may choose to pass on the additional tariff costs to consumers, while others might absorb them to remain competitive.
Retailers typically won’t make significant announcements regarding these price increases. Instead, tariffs tend to elevate prices subtly and without prior notice.
Below is a selection of products likely to see price increases as tariffs remain in place.
Gaming Consoles and Mobile Phones
Video game consoles and smartphones are among the most significantly affected products as they are categorized as premium items with few alternatives for consumers. According to The Wall Street Journal, nearly all gaming consoles are manufactured in China, leading manufacturers to likely transfer the complete cost of tariffs to consumers, knowing there is a strong consumer demand. A 10% tariff on a $500 console could increase the price to $548.
Wine
An imported Italian wine could see its price rise by 10% due to a tariff, increasing from $21.99 to $24.08, as reported by The Wall Street Journal.
The final amount you pay can also vary based on factors such as currency fluctuations, market alternatives, and pricing strategies of sellers. For instance, domestic wine producers may increase their prices in reaction to imported wine price rises, even if their own costs remain unchanged.
Automobiles and Major Appliances
Tariffs on imported vehicles, refrigerators, and washers often result in higher consumer prices. Following the implementation of tariffs on washing machines in 2018, prices surged by 12%, as per researchers from the University of Chicago.
A 25% tariff on automobiles is currently applied, with analysts from Bank of America predicting potential increases of up to $10,000 for affected vehicles if the full tariff cost is passed on to consumers, as stated by CNBC.
Moreover, the increase in prices is not likely to end there. Much like the situation with wine, local car manufacturers and appliance makers may also opt to raise their prices to align with the elevated cost of imports, even if their own production expenses haven’t changed.
Products with Abundant Alternatives Are Less Affected
Items with a wide range of options, such as clothing, car parts, and cosmetics, typically won’t experience as severe price impacts from tariffs.
According to an analysis by Moody’s, a 10% tariff on an imported tablecloth from India may only lead to a 2% price increase, according to The Wall Street Journal. This modest rise occurs because numerous manufacturers globally provide similar products, reducing the likelihood that retailers will transfer the entire cost to consumers when cheaper options are readily available.
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