So we have an update on how much the cost of NVIDIA graphics cards is going to go up in the near future due to the impact of the tariffs imposed on $200 billion of goods manufactured in China. We have discussed this topic in a lot of detail before here, so if you want to catch up on the situation you should probably read that first. Long story short, these tariffs will come into force tomorrow on the 24th of September.
Big AIBs with Taiwanese manufacturing capability will take the tariffs in stride within a month or two, smaller ones like Zotac will have to absorb costs
Practically all PC components are being affected by the tariffs – which include motherboards, RAM kits, HDDs, GPUs and CPUs – with the only exception here being SSDs. On the peripheral side, keyboard and mice are exempt as well, as are pre-built systems (including servers) and complete laptops. The final tariff rate is 10% and will come into force tomorrow (9/24). Add-in-Board partners have the option of either moving their manufacturing/assembly to another country (most likely Taiwan) or absorb the tariffs (which means reducing their margins or passing on the cost to their customers). OEMs etc have the option of moving assembly to places like the Mexican Free Trade Zone (or Taiwan of course). Needless to say, neither of these things can happen instantaneously – so we will see a temporary price hike as the tariffs kick in
Since graphics cards currently have a significant portion of their manufacturing in China, the companies are faced with the option of either absorbing the tariff or moving production to an alternative country – like Taiwan – to avoid the same. We were not able to give you a good idea of what kind of cost increases you can expect to the selling price of the RTX series before since they hadn’t been finalized yet, but now we can.
Based on the information we have received we are expecting price increases of roughly $75 to $80 for the RTX 2080 Tis and $50 for the RTX 2080 variants. For major AIBs like MSI and GIGABYTE who already have facilities in Taiwanese, the hike in price will be temporary – lasting 2 months at most – before they are able to revert back to normal pricing. Smaller AIBs like ZOTAC however, who do not have manufacturing present in Taiwan already will be at a significant disadvantage and disrupted. They will be in the unenviable position of either absorbing the tariff and reduce their margins while keeping the pricing same or pass on the cost to customers (which means when the major AIBs reverts back to normal pricing – they won’t be able to and become uncompetitive).
Example: MSI’s NVIDIA RTX Lineup New Pricing After Trump Tariff
Here is one of the lists we received with post-tariff pricing going live very soon (if not already):
- RTX 2080 Ti Gaming X Trio: $1231 to $1310
- RTX 2080 Ti DUKE 11G OC: $1212 to $1290
- RTX 2080 Ti VENTUS 11G OC: $1203 to $1280
- RTX 2080 Gaming X Trio: $849 to $900
- RTX 2080 DUKE 8G OC: $840 to $890
- RTX 2080 VENTUS 8G OC: $830 to $880
One of the AIBs we talked to also had the following to say about the price hike:
“We should only have a month’s gap from now before Taiwan manufacturing is online. Rest of the line i.e. [mentions various of their RTX models] will be on the new assembly in Taiwan. The timeline [of shipment schedule getting caught up in tariff] threw a wrench into our plans. Originally we thought we would have some of the prelaunch allocation [reserved for Amazon, Best Buy, Newegg and other retailers] left over to give to SI partners but because the etailer pre-launch prepaid order volume exceeded the NVidia allocation, we are stuck with giving them the pre-tariff cost structure we had to allocate 100% of our prelaunch allocation out to the actual prelaunch partners first. Whatever we can’t fulfill this week we’re going to absorb the 10% between us and the etailer to still fulfill end customer’s orders meaning all SI orders, for now, are subjected to almost a +10% increase with us sharing some of the cost”. – Anon AIB
So this means that while the tariffs are kicking in from tomorrow, many retailers who have inventory from old stock will probably stick to the standard pricing till they finish – so if you are in the market to buy these, buy now, or be prepared to wait for at least 3 months before the pricing normalizes. Meanwhile, Pascal inventory, which has already been handed out should not be affected much by these tariffs and will only become a better deal for gamers. A very interesting side effect of this entire situation is that AIBs like ZOTAC might actually seek to develop new markets outside of the US to overcome their disadvantage on the Taiwanese manufacturing side.