Tarrifs Impact Nintendo
Nintendo’s upcoming release of the Switch 2 console, set for June 5, 2025, is shaping up to be one of the most anticipated gaming launches in recent memory. But as fans gear up for the next generation of hybrid gaming, an unexpected hurdle has emerged — international trade policy.
On April 2, President Donald Trump announced a new round of tariffs, including a 46% levy on goods imported from Vietnam. That single move could significantly reshape the cost landscape for consumer electronics — especially for companies like Nintendo, which shifted production of its consoles to Vietnam years ago to avoid earlier tariffs targeting China.
Shortly after the announcement, Nintendo made a surprising decision: it paused pre-orders for the Switch 2 in the U.S. and Canada. In a brief statement, the company cited the need to “assess the potential impact” of the new tariffs and changing market conditions. For a company known for smooth, hype-driven product launches, this pause signals just how seriously Nintendo is taking the threat.
Why Vietnam Matters
After the U.S. placed steep tariffs on Chinese imports in 2019, Nintendo — along with many other tech giants — moved a large portion of its manufacturing to Vietnam. The country quickly became a critical hub for electronics production. But with the new tariffs targeting Vietnam, companies are once again left scrambling to recalculate supply chain costs and reassess pricing strategies.
The timing couldn’t be worse. The Switch 2 is already expected to launch at $449.99 — a significant jump from the original Switch’s $299 launch price. While that increase is largely due to new hardware upgrades, like a more powerful processor, improved Joy-Cons, and a larger display, any new tariff-related costs could push the price even higher — or eat into Nintendo’s profit margins.
What’s at Stake?
There are a few possible scenarios at play here:
- Higher Retail Prices: If Nintendo chooses to pass the tariff costs on to consumers, we could see the Switch 2 launch at a price north of $500 — potentially pricing out more casual buyers.
- Thinner Profit Margins: Alternatively, Nintendo could absorb the cost increases and hold firm on its $449.99 price point, betting on volume sales and first-party software to make up the difference.
- Production Shifts (Again): The company could look to move production yet again — possibly to countries not affected by the new tariffs — though such a move would likely take months and involve significant cost and risk.
The Bigger Picture
Nintendo isn’t alone in its concerns. The video game industry has historically warned that tariffs on manufacturing hubs like China or Vietnam would drive up costs and hurt consumers. Microsoft, Sony, and Nintendo previously issued joint statements during the last trade war, arguing that such policies could result in hundreds of millions in additional costs for U.S. gamers.
This is particularly true for consoles, which have razor-thin profit margins and rely heavily on a competitive launch price to build a large install base quickly. A misstep here could cost Nintendo both sales and market share.
Tarrifs
The Switch 2 is ready to take the spotlight this summer — but now, its final price tag could be shaped just as much by politics as by performance. Nintendo’s decision to hit pause on pre-orders is a clear sign that it’s not business as usual. Whether that means a price hike, delayed shipments, or further behind-the-scenes maneuvering remains to be seen.
One thing is certain: the intersection of global trade policy and consumer tech is becoming increasingly hard to ignore — even in the world of video games.
