After his inauguration, President Trump issued a new executive order with a new 25% tariff for Mexico and Canada, expected to go into effect on February 1.
Given that a good amount of production for video game discs takes place in Mexico, this may have a negative impact on American consumers.
Circana analyst Mat Piscatella has shared his thoughts on social media, saying that he expects to see a “sharp downtick” in the number of disc-based games that are released in the US, given that “much of that production infrastructure” is in Mexico. If companies still go ahead with making discs, then consumers can expect higher prices, he said. And not just for physical discs. Piscatella said he expects digital game prices to go up as well.
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Digital games have no discs, but companies may desire to maintain price parity across the physical and digital in the event that the tariffs increase prices. Piscatella added that he doesn’t know how this will all actually shake out and is only theorizing for now. However, he said, “None of this is good for the physical video game market.”
Piscatella added that US-based video game companies could shift production out of Mexico and into the US, but not without “significant investment.” That’s probably not going to happen, in part because spending on physical games in the US is already half of what it was in 2021 and continues to decline “rapidly,” Piscatella said.
Trump has also suggested he could implement a 60% tariff on goods from China, which could have significant ramifications on video games and video game hardware. Yet, many question whether or not this is feasible or will even happen.
In addition to price hikes from potential tariffs, many in the gaming business are wondering if GTA 6 will trigger a new industry-wide price increase on the MSRP for games, potentially up to $80 and more. The most