Xbox Series X Price Jumps by $100 in the U.S.
Experts Cite "Aftermath of U.S.-China Tariff War"
Microsoft (MS) has significantly increased the price of its Xbox consoles in the United States. Experts attribute this to the aftermath of the U.S.-China tariff war. The Trump administration imposed a 145% tariff on China, where Xbox consoles are primarily manufactured, resulting in the gaming industry being affected as well.
According to the Washington Post (WP) and other sources, starting on May 1 (local time), MS raised the U.S. consumer price of the Xbox Series X from $500 to $600.
At the press preview of the 'Paris Game Week' expo held last year, visitors are seen playing the American video game company Electronic Arts' 'Dragon Age' video game on the Xbox console. Photo by AFP Yonhap News
The lower-priced Series S also saw an increase from $300 to $380. Prices also rose in Europe, including the UK, and in Australia, but the increase was much smaller than in the U.S. For the Series X, the price in Europe increased by 50 euros to 599.99 euros. In the UK, the price went up by 20 pounds to 499.99 pounds.
MS cited "market conditions and rising development costs" as reasons for the price hike but did not respond to questions about whether tariffs played a role.
The Xbox Series X was released in 2020. Typically, the price of a gaming console decreases gradually after its launch. It is unprecedented for the price of a console released several years ago to increase this significantly. Industry experts believe that because MS manufactures most of its consoles in China, the tariff war between the U.S. and China has had an impact.
Matt Piscatella of Circana, a market research firm, and Daniel Ahmad of Niko Partners recently interpreted MS's move as a response to the U.S. government's imposition of a 145% tariff on China, where Xbox consoles are primarily manufactured. They commented, "What was expected is now happening. Similar events are likely to occur more frequently in the future."
Back in 2019, during the first Trump administration, when the U.S. was considering imposing tariffs, MS, along with competitors Nintendo and Sony, sent a joint letter to the U.S. Trade Representative (USTR). The letter stated that, as of 2018, 96% of video game consoles imported into the U.S. were manufactured in China, and that tariffs would undermine years of investment in the global supply chain, harm consumers, and potentially eliminate thousands of American jobs.
Since then, Nintendo has diversified its manufacturing to other countries such as Vietnam and Cambodia.
Last month, Sony raised the price of PlayStation consoles in Europe, Australia, and New Zealand, citing inflation and exchange rate fluctuations. Gamers expect that, as the U.S. continues its trade war with China, console prices in the U.S. will soon increase as well.
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