Could the graphics card market soon be on the rebound?
It’s no secret that computer components are very expensive right now, but no component has suffered more than the graphics card. With most cards selling for 150% or more of their usual manufacturer’s suggested retail price (MSRP), now is perhaps the worst time in recent history to build a computer. However, there may be a light at the end of the tunnel!
The Biden administration announced today that a Trump-era tariff on Chinese-made goods would temporarily be lifted, at least until the end of 2022. The tariffs, which added a 25% duty to a wide variety of electronic goods and components manufactured in China, were partially responsible for a rapid increase in many computer components. Coupled with the COVID-19 pandemic and reduced manufacturing capacity, it all added up to many parts being in short supply, leading to drastically higher prices.
Under former President Trump, the US government slapped tariffs, or import taxes, on a wide variety of goods from a number of countries. While the Chinese goods had a notable impact on consumers, others, including on Canadian lumber, also led to skyrocketing prices.
The biggest question remaining is whether the tariff exclusions will actually lead to any significant price changes in the market. The global chip shortage and increased demand may not give graphics card manufacturers any incentive to actually drop prices, and economists tend to believe that once consumers are used to a price point it’s rare to see a reduction short of a seismic shift in an industry.