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Amazon allegedly "strong arming" PC component manufacturers over tariff-related price increases


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Amazon Strong-Arming PC Manufacturers over Tariffs

 

We’ve heard from multiple industry contacts that the US tariffs that may go into effect on September 6th are causing trouble for PC component manufacturers. The new tariffs are expected to impact component import cost by anywhere from 10% to 25%, depending on final decisions at the USTR, and those costs will largely be passed on to consumers. Right now, we know that video cards, motherboards, coolers, power supplies, and likely cases will be impacted. Most manufacturers with US-based warehouses have been importing as much product as possible before the decision, as the tariffs will only impact cost of items not yet in port stateside. Every add-in board partner is impacted and every power supply maker is affected, from what we’re told.

 

As for Amazon’s role in all of this, our sources at PC component manufacturers have indicated that Amazon is strong-arming part makers into their existing price positions. Several manufacturers have indicated to Amazon a wish to raise MSRP to cover the potential 25% import, as almost none of these products have margins higher than 10%, so the tariffs will make them unprofitable. Amazon has responded with notices that it will not permit manufacturers to pass along increases to consumers. While this is noble in some respect, component manufacturers simply can’t sell on Amazon at a loss -- they’d go out of business. The current proposed work-around is to discontinue existing parts on Amazon and recreate the inventory with new product IDs and higher prices. The time cost of doing this must also be accounted for.

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15 minutes ago, LazyPiranha said:

For Amazon.  What does Amazon get out of this?  They get to have a bunch of defunct product listings that aren't available for sale and a bunch of higher priced options that are?

no they are probably not wanting to see prices rise as that would most likely mean less overall sales of the products.  its saying if the manufacturers want to raise the prices that would be their "work around" is to relist which would take more time and effort they dont want to spend on.

 

Do we know if places like newegg or microcenter would try and do the same or if they will let them price higher?

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