Executives from the company who presented Sony’s latest financial report to investors on Wednesday were inevitably asked about the impact of President Donald Trump’s tariffs on their business and how they will respond. They had a variety of answers, including price hikes. And incredibly, they didn’t dismiss the idea of making a US PlayStation 5.
“The game console (…) can be produced locally. I think it’s an efficient strategy,” said Totoki, president and CEO of Sony. “We need to consider whether (PS5) will be manufactured in the US.”
That’s an astonishing statement. This is because it takes years and requires serious investments to create the manufacturing capabilities of the US PS5. But Totoki’s words are a sign that in the current unpredictable situation, nothing has fallen off the table and that the idea is not a bad idea.
A more anticipated move could be to raise prices, and Sony admitted that this is also possible, although it is as ambiguous as possible. Chief Financial Officer Lin Tao said Sony is seeing a financial impact of 100 million yen (approximately $684 million) on divisional tariffs. “We might take over the price,” she said. However, she also said Sony is taking various measures such as shipping allocation to mitigate the impact of tariffs.
A proper case: Tao said Sony has a stockpile of PS5 consoles in the US, which should last for three months. This could mean that you can wait a while for the situation and see what happens, and that the price rise for the PS5 is still a few months away.
The PS5 is primarily manufactured in China, and the Trump administration receives higher tariffs than most other countries. This week, in a temporary escalation, the US reduced tariff rate on Chinese imports from 145% to 30% over the next 90 days. It’s encouraging news, but it also highlights the unpredictability of the situation. This is what electronics manufacturers like Sony and Nintendo are looking for answers. Nintendo essentially said Tuesday that it was the Switch 2 launch year and that it would hit tariffs rather than raising prices as usual because it didn’t want to slow down momentum in the new console.
In summary, company executives are just as ignorant of what is going on as everyone else in us, and most want the best, stable. As analyst Matt Piscatella told Bruski: “The big point from the latest video game revenue statement on the tariff situation is that a) they are not confident in predicting what will happen next b) people have multiple scenario plans, but are trying to keep track of when possible.
Well, we can all be related to it.
