Gaming PC

GPU Tariff Exemption Expires December 31, Could Spell Higher Graphics Card Prices

Prices for the best graphics cards in the US could rise in early 2023 as tariff exemptions imposed by the Trump administration years ago expire on December 31st. The US Trade Representative may update the exemptions, or graphics card manufacturers may try to find ways to avoid high tariffs.

“We’ve heard from two sources that AMD Radeon, Intel graphics and Nvidia GeForce graphics cards will be subject to new import tariffs in January,” said hardware industry veteran Kyle Bennett of HardOCP fame. I write like twitter Position. “Does anyone smarter than me (not saying much) know how to look it up and get it relevant? If so, December might be a good time to buy. not.”

I’m not sure what tariffs our colleague meant, appear As one of Kyle’s readers, the import tariffs in question are nothing new. It pointed outThis 25% tariff is imposed Years ago, the Trump administration aimed to effectively penalize China-based hardware makers, including not just graphics cards, but laptops, motherboards, and other devices. The Trump administration then agreed to temporarily lift tariffs, and the Biden administration allowed 352 exemptions to tariff rules. These exclusions are set to expire on December 31, 2022.

Some manufacturers initially tried to import almost-finished goods into the United States to avoid paying punitive duties, but now the list of items subject to tariffs includes “unfinished logic board construction It includes things like ‘printed circuit assembly’, and that practice has pretty much been killed. If the USTR does not reinstate the exemption, the importer will have to pay his 25% tariff on graphics cards starting January 1, 2023.

Graphics card prices, on the other hand, have every reason to go up compared to 2019 even without tariffs. Developing GPUs made using TSMC’s N5 and 4N (5nm class) manufacturing technology is very expensive, with the physical implementation of the GPU (including software) costing him over $500 million. It takes Manufacturing on one of TSMC’s N5 production nodes will cost more than manufacturing a GPU on TSMC’s N7 or Samsung’s 8LPP (potentially costing twice as much). Due to rising salaries and inflation in China, production costs are also higher than they were a few years ago. Finally, transportation costs are also higher than in 2019.

It remains to be seen if the 25% tariff will actually be imposed on graphics cards, motherboards, laptops and other devices. Even if another exemption is granted, we don’t see new mid-range to high-end GPUs at $200-$300 anytime soon.

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