Circana analyst Mat Piscatella has stated that a proposed tariff on imports from Mexico could result in fewer physical game releases and higher software prices in the US.
The proposed tariff was revealed by newly-elected US President Donald Trump, who after being sworn into office earlier this week committed that existing trade deals with Canada and Mexico are being reviewed by his administration.
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With 25% tariffs on imports from Mexico on the way, I can see a sharp downtick in the number of disc-based games that get released physically in the US, as much of that production infrastructure is in Mexico. I would, were this to happen, anticipate digital MSRPs to increase to remain at price parity with physical, but who knows. In any case, none of this is good for the physical video game market.
Back in January 2020, it was feared that Trump’s proposed 25% tax on electronic goods during his first tenure as US President would significantly bump up the price of PS5, which thankfully didn’t happen.
[Source – Mat Piscatella on Bluesky via VGC]