How US tariffs on Japan could impact Americans playing Nintendo video games

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(TOKYO) — For Americans who were eagerly awaiting the release of the Nintendo Switch 2, the delay of U.S. pre-orders for the popular new gaming console this April was one indication of what’s to come if President Donald Trump’s planned 25% tariffs on all Japanese exports goes into effect on August 1, as he’s said it will in his latest letter to the Japanese government on July 7.

U.S. pre-orders of Nintendo’s next generation gaming console were delayed from April 9 to April 24 because of the impact of potential tariffs from the U.S., the company said at the time.

Nintendo moved forward with the planned June 5 launch date of the device in the U.S., selling 3.5 million consoles worldwide in the first four days on the market, but the delay for such a high-demand product suggests consumers could see greater impacts to products from the popular gaming company that are sold in the United States in the near future.

“There will be tariffs imposed on the devices, so definitely there will be impact,” Professor Yusuke Koyama who teaches economics and focuses his research on the gaming and animation industry at Shibaura Institute of Technology in Japan told ABC News.

“If the tariffs are fixed, and it’s clear that it’s going to be a long-term thing, they are definitely going to have to raise prices,” he added.Tariffs on Japanese exports aren’t the only issue Nintendo could face in the Trump tariff war, Koyama said.

The Nintendo Switch 2 devices are primarily manufactured outside of the U.S. in China and other countries in Southeast Asia. Because of this, the devices will be impacted by the tariffs not only on Japan but on other Asian countries as well, he added.

Nintendo previously had most of their devices made in China, but the company began shifting its production sites to other countries in Southeast Asia in 2019, during the first Trump administration, Koyama said.

“It is not an easy thing to move the production sites on the devices,” Koyama said.

Japanese electronics companies may have to restructure once they start to feel the impact from the U.S. tariffs, chief economist at the Japanese Dai-ichi Life Research Institute Hideo Kumano told ABC News.

“At the moment, people don’t really feel the impact, but recently some electronics companies announced their plans for restructuring,” Kumano told ABC News. “If such plans are actually executed, then people lose jobs … Such a negative impact might be felt by summer or autumn onwards.”

Nintendo has not announced any plans for restructuring publicly at this time, and Nintendo declined ABC News’ request for an interview.

If a Japanese company does business globally, it will be impacted by the coming tariffs, Kumano added. “All companies that do business globally will be impacted one way or another,” he said.

While Nintendo’s gaming consoles and physical products will be impacted, the games consumers can download won’t be subject to the new tariffs. While the U.S. consumer downloading ratio compared to purchasing of physical products is already high, Koyama said he could see this area of Nintendo’s business expand if the tariffs do cause other prices to increase.

“In the U.S., it already has a high downloading ratio, so I think that trend may just get stronger with this,” Koyama said. “In Japan, the packages are still more popular.”

Despite potential price hikes, Koyama predicts consumers will still purchase Nintendo products and games, because their games are unique compared to their competitors.

“Nintendo is producing games that you cannot find in other PC games or PlayStation games, so that’s why the games are very popular,” Koyama said. “I think the consumers will still buy.”

Japanese companies Kumano has spoken with said these tariffs are unlike anything they’ve seen before.

“I’ve actually had conversations with people from various companies, and they all say that things were changing so rapidly. This is the first experience for them to be involved in such rapid and dramatic change,” Kumano said.