Trump's China Trade War Pulls Consumer Tech Into Crossfire

The prices of headphones, speakers, high-tech lighting and internet service could all go up if the U.S. trade war with China continues.

The Trump administration’s hit list of Chinese products facing import taxes includes key components used in gadgets that can be wirelessly operated through a smartphone or another device. The tariffs also will nail networking equipment that makes the internet work.

It remains unclear how much prices might rise, partly because the next round of tariffs won’t be imposed until the fall. The technology industry’s broad reach and financial heft also complicates the calculation.

Apple, Google, Microsoft and other major technology companies have such diversified product lines and deep pockets that they simply could absorb the additional costs triggered by the tariffs rather than pass them along to consumers.

But even the richest companies will usually only shoulder an ongoing tax such as a tariff for so long before raising prices, said Timothy Sturgeon, a senior research affiliate at MIT’s industrial performance center.

Those prices will eventually hit consumers, Sturgeon predicted. “That’s how companies work.”

Citing national security concerns, the Trump administration has already imposed a 25 percent import tax on $34 billion worth of Chinese goods, but the impact on electronics was mostly limited to components for TVs and video equipment.

The next volley will drop a 10 percent tariff on another $200 billion in Chinese imports , including chips used in consumer electronics devices like those made by JLab Audio, a Carlsbad, California, maker of Bluetooth headphones and speakers that connect wirelessly to phones. The administration’s proposed tariffs would affect products that generate 70 percent to 80 percent of JLab’s sales.