Daniel Thomas
Business Reporter, BBC News
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Almost 80% of smartphones sold in the United States are made in China
Deena Ghazarian was only in business for a year when the trade policies of President Donald Trump’s first term of the first term have sent his business to a flesh.
It was in 2019 and his company in California, Austre, had just agreed to provide several large American retailers with its high -end audio and video accessories which are largely made in China.
Then Trump imposed radical prices on China, and Deena overnight, he found himself paying a 25% supplement on each cable and composing that she imported – before.
She was forced to absorb the costs and, for a while, thought that she was going to go bankrupt.
“I literally thought that I will start and put an end to a business in less than a year,” she said. “I had spent all this time, this time, money and efforts, and to have something like this blind, you were shocking.”
The company took place, but like many other American companies, it is now in a surprisingly similar situation.
Since his return to duties in January, Trump has increased prices on all goods imported from China by 20% and has put 25% taxes on Canadian and Mexican products, to delay some of them until April.
Deena Ghazarian
Deena Ghazarian says that her business has almost gone bankrupt because of the prices in Donald Trump’s first mandate
The president says that he wants to force these countries to do more to stop the flows of illegal drugs and migrants to America, to bring more manufacturing to the United States and to resolve what he considers that unjust commercial imbalances.
But the tasks have a much broader range than the last time, when they were gradually gradually and many products have obtained exemptions.
Goods such as smartphones, desktop computers and tablets are now raising prices for the first time, while taxes have increased above.
“American importers must pay these taxes and not exporters,” explains Ed Brzytwa, vice-president of international trade in the Consumer Technology Association (CTA), a North American commercial body which represents more than 1,200 technological companies.
“It is American companies and consumers who will suffer.”
Companies like Ms. Ghazarian are particularly exposed. China is still the leading supplier of electronic products in the United States, with imports totaling $ 146 billion (112 billion pounds Sterling) in 2023, according to official data.
Meanwhile, 87% of American imports of video game consoles came from China that year, 78% of smartphones, 79% of laptops and tablets and two thirds of monitors, according to the CTA.
While many American companies like Austere have diversified their supply chains away from China since Mr. Trump’s first term, countries like Thailand, Taiwan and Vietnam still do not offer the same manufacturing and expertise capacities.
At the same time, the American president now targets Mexico – another major electronics supplier. And while interior manufacturing in the United States has increased, partly due to prices, it is always limited by higher costs and more strict regulations.
“Yes, Apple now manufactures iPhones in India and (the manufacturer of Taiwanese chips) TSMC diversified in Arizona,” said Mary Lovely, principal researcher at the Washington DC Peterson.
“But China is still part of the supply chain. Relations with new suppliers take time to develop, they are expensive to develop.”
Research suggests that companies transmit a large part of the costs of prices by implementing prices. Earlier this month, Corie Barry, boss of the American retailer Electronics Best Buy, said that the “vast majority” of new prices “will probably be transmitted to the consumer” because industry sellers have such small margins.
In February, the Taiwanese company Acer said that the price of its laptops would probably increase by 10% depending on the 10% tasks in place on China at the time, while the American group HP warned that its profits would be lower due to the prices.
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China remains the center of global technological manufacturing
Ms. Ghazarian says that she may have to increase her prices this year, but worries that this could turn around. “There is a price where the customer is satisfied with the value of the goods provided.
“As I drop out above, I start to lose customers. High inflation has tightened the Americans.”
During the first term of Mr. Trump, companies such as Apple managed to obtain exemptions for products, and we can still see cuts.
The initiates also suggested that Mr. Trump considers prices as a negotiation tactic and could relieve them if he won concessions, as he did when China agreed to buy more American goods in an agreement concluded in 2020.
Fears of an economic slowdown in the United States could also make him change course.
For the moment, tensions seem likely to degenerate. China, Mexico and Canada have promised to retaliate against the American tasks imposed on them, and this week, Trump threatened to double the prices on Canadian steel and aluminum to row at the last minute.
He plans to impose “reciprocal prices” on the rest of the world soon, and threatened increases in prices of up to 60% on Chinese products on the campaign track.
There is a risk that this could increase the price of technological products worldwide if China is forced to move manufacturing in countries where labor costs are higher. In addition, countries can retaliate with imported American technology prices.
Ms. Ghazarian says she is worried, but at least she is prepared this time. Like many other owners of American companies, she ordered additional inventories before Mr. Trump took up his duties and stored him in his East Coast warehouse.
She hopes it will pass the business over the next year until it can “rotate” again.
“It could mean finding a more profitable way to produce the product or do something completely different. It is frustrating that I have to focus on survival rather than the growth of my business.”
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