New US duties could change the gaming market, causing console prices to rise and physical copies to disappear

The US government has introduced new duties on imports from China, Canada and Mexico, which could have a significant impact on the gaming industry. Consoles, accessories, and physical copies of games are expected to rise in price, and publishers may switch to digital formats.

Here's What We Know

On 4 March 2025, the following duties came into force: 25% on imports from Canada and Mexico and 20% on goods from China. Since most game consoles are manufactured in China and physical copies of games are printed in Mexico, these changes could have a significant impact on prices for US consumers.

Analysts predict that the cost of the new duties will be passed on to customers, which will lead to higher prices.

According to Circana analyst Matt Piscatella, physical copies of games may cease to be produced at all due to the increased costs. He noted: "I wouldn't be surprised if publishers simply switch to an all-digital strategy."

The physical games market is already in decline, and the new duties could be the last blow to this segment. It is possible to produce discs in the US or other countries, but due to the decline in demand, it may not be economically viable.

According to Jonathan Ahmad of Niko Partners, about 75% of gaming equipment is imported from China. Although some companies have already started to move production to Southeast Asia, this process will take time.

It remains to be seen how these changes will affect the long-term strategy of companies and the availability of physical copies in the future.

Source: @matpiscatella.bsky.social