A PC ‘recession’ could make hardware way more expensive, says researcher

By Jacob Roach Published December 4, 2024

Get ready to spend big if you plan on scoring one of the best graphics cards or best processors. According to Jon Peddie Research, the PC market could be headed for a “recession” due to proposed tariffs on several countries, which are said to go into effect shortly after Donald Trump becomes president on January 20.

The quote comes from JPR’s third-quarter GPU market study. Market share has shifted a bit, CPU shipments are up by 12%, but there really isn’t much to write home about — short of the tariffs. “AMD and Intel released new CPUs, and there was some pent-up demand for them. However, looking forward, we think that if the proposed tariffs are imposed, the PC market will suffer a recession due to increased prices and unmatched increases in income,” wrote Dr. Jon Peddie.

The speculation is hardly surprisingly, as we’ve been looking at the proposed tariffs for a while now. The situation might be worse than expected, though. Projections about prices show that laptops and tablets could increase by as much as 45% in price, but even those estimates — put out by the Consumer Technology Association (CTA) — don’t capture the full scope of what prices could look like next year.

Originally, the Trump administration proposed a sweeping tariff on China as high as 60%. The CTA’s report is based off of those tariffs. Since the report, the incoming Trump administration has proposed tariffs on both Canada and Mexico as well. Tariffs on Mexico would be a particular pain point, as many desktop brands moved manufacturing from China to Mexico during the first Trump administration in order to avoid the tariffs.

PC hardware companies are privy to what the tariffs could mean. Just recently, Intel revealed its Arc B580 desktop graphics card, and the company says its Limited Edition model — the model made by Intel — will be manufactured in Vietnam, hopefully dodging any tariffs. Vietnam has become a hotbed for PC hardware over the last several years due to the trade war between the U.S. and China. The Harvard Business School says that integrated circuits (ICs) — the bedrock of all electronics — are the most common export rerouted from China to Vietnam to be exported to the U.S.

The vast majority of PC hardware isn’t built in the U.S. Although U.S.-based companies like AMD and Nvidia design their chips domestically, manufacturing happens overseas, be it in China, Mexico, or Vietnam. If the proposed tariffs go into effect, it’ll have large implications for PC hardware pricing.