Trade War Concerns Cast Shadow on Consumer Electronics Show

This year's Consumer Electronics Show (CES) in Las Vegas has once again seen a strong presence from Chinese companies, but their future prospects are cast into doubt due to the looming threat of increased tariffs from the new U.S. president, Donald Trump.

Notable products from Chinese firms, like XPeng's innovative "flying car" and TCL's AI-enhanced television, have garnered attention at this annual tech event. However, the potential impact of Trump's trade policies on the global tech industry has been a significant concern among attendees.

During his election campaign, Trump hinted at imposing tariffs as high as 60 percent on Chinese imports, and his administration has maintained a tough stance since he took office in November. While some analysts view these threats as negotiation tactics, they also recall the intense trade conflict that marked Trump’s first term and continued through President Joe Biden's administration.

Chinese businesses at CES have exhibited varying degrees of worry regarding these impending tariffs. Mekia Yang, a representative from startup Jitlife, which produces "smart" suitcases in Guangdong Province, expressed some concern over the current administration's policies but remains hopeful that any harsh measures will be short-lived. She stated, "Trump might act tough at the beginning, and then he might change, because there will be some pressure from domestic markets due to rising prices."

Meanwhile, Zhanbin Ao from Mammotion Technology Co., which offers autonomous lawnmowers, shared his concerns about new tariffs but mentioned that his company is proactively relocating its production to Thailand, Vietnam, and other Asian countries. "Once we move our manufacturing to other countries, a tariff is not an issue for us," he explained.

On a more optimistic note, Haojia Dengyang of Shenzhen Haoqitansuo Technology assured that his company’s products, which include smartphone cases and charging devices under the Torras brand, would still appeal to U.S. customers, even with new tariffs, as they are high-quality and valuable.

Speaking on the political climate surrounding CES, Gary Shapiro, president of the Consumer Technology Association, aimed for a diplomatic approach. He expressed hope that Trump would shift away from the aggressive stance characteristic of the Biden administration, which he compared to “death by a million cuts.” Nonetheless, Shapiro criticized tariffs, describing them as a tax on consumers, and warned that a 60 percent levy on Chinese goods would be devastating to the economy.

He highlighted that retaliatory measures from China and other markets could adversely affect U.S. exports. "This is not good for the country," Shapiro said, emphasizing the need for strong trade ties globally. "In today's world, no country can go it alone...we must avoid unnecessary tariffs."

U.S. companies at CES have also been cautious about political discussions during product launches, though many are keeping the potential impact of tariffs in mind. John Pfeifer, CEO of Oshkosh, noted that while most of their production is domestic, any blanket tariffs could still have significant ramifications, leading the company to consider reshoring production or modifying supply chains to mitigate the effects.

Deanna Kovar, president of John Deere's Worldwide Agriculture & Turf Division, shared that their primary concern revolves around ensuring their customers have access to markets for their produce and avoiding retaliatory tariffs, which could harm the agricultural sector.

CES, trade, tariffs