It seems that Sony and Nintendo both plan to partially shift console production out of China – Nintendo has officially confirmed it already!
Let’s start with the big N – a Nintendo spokesperson told Reuters that part of the Nintendo Switch production is moved out of China. We’ve already written about the rumours of a move to South East Asia, but it’s now confirmed: the new country that will see some of the production will be Vietnam! The partial move will happen this summer, and while Nintendo did not explicitly say that the reason behind the move is the lingering 25% tariff on video game consoles imported from China, it’s obviously the reason. Even though Donald Trump, the president of the United States of America, has suspended introducing more tariffs on made-in-China products, the list that surfaced in late May included video game consoles. (And the tariff war between the US and China might continue, so this is a safety measure. Also, Microsoft, Sony, and Nintendo wrote a joint statement about how the tariffs would badly harm the console sales…)
Nikkei writes about how Sony and Nintendo might join PC hardware production companies such as HP, Lenovo, ASUS and Dell in the Chinese exodus, as they claim the console manufacturing costs are increasing in China. „The industry consensus is to move an average of some 30% of production out of China depending on how important the U.S. market is… Everyone needs to come up with a plan,” one executive working in supply chain told Nikkei.
According to Nikkei’s information, Microsoft is planning to go to Thailand and Indonesia, but there’s no such info about Sony. This shift will likely increase the console prices, including the next-gen hardware, too. That’d be bad for us.