The Death of Affordable Computing | Tariffs Impact & Investigation (Gamers Nexus)

[TonyCarter]

Long video, but Tech Jesus speaks with a lot of companies about how the Trumpiffs could affect them.

 

[SpyderTracks]

I would recommend anyone to skip to 24:50 for an in-depth glimpse of the actual costs, and hence returns that penetrator companies can expect in this industry.

Hyte's full attitude has been halo products with the Y70 and Y70 Touch, and the Hyte Thicc cooler to make such a statement that it puts their name into peoples center vision, that way hopefully they gain followers and increase sales. You can see just how little they're making on each case, but their approach has unquestionably been working, and working extremely well.

I just hope very strongly that they can make up the lost USA region volume in other markets because we need companies like Hyte, plus they have some really fresh designs.

 

[SpyderTracks]

This is well worth a watch.

So we've already seen companies scrambling and prices being raised on some products.

Unfortunately the reality is yet to fully impact.

This is a recent interview with the Executive Director of the Port of Los Angeles talking about the realities of what's happening with imports to the US

TLDR: IF the US autocracy doesn't cowtail and back down, the US can expect to see shortages on shelves within around 5 weeks. According to him, China are getting products through with tariffs being waved, but that's not the case for goods coming into the US

https://www.marketwatch.com/story/gdp-shrinks-for-first-time-in-3-years-as-trump-tariffs-trigger-record-trade-deficit-1819f9af

 

[TonyCarter]

I bet China (or the companies wanting to import from China) will just use the same tactic that they used to get around EU tariffs...where they either sent everything through a subsidiary in a non-tariffed country (India, Taiwan, Vietnam, Malaysia, UAE, etc.) or lied on their documentation.

We started seeing stuff that we knew was made in China, and the shipments came directly from China, with 'Made in Vietnam' or 'Made in Germany' stamped everywhere.

 

[SpyderTracks]

I bet China (or the companies wanting to import from China) will just use the same tactic that they used to get around EU tariffs...where they either sent everything through a subsidiary in a non-tariffed country (India, Taiwan, Vietnam, Malaysia, UAE, etc.) or lied on their documentation.

We started seeing stuff that we knew was made in China, and the shipments came directly from China, with 'Made in Vietnam' or 'Made in Germany' stamped everywhere.

I meant the other way, Chinese products being imported to US are not able to have tariffs waved at all.

US product being exported to China is often being allowed through their customs without tariff fees being called for.

So the US somewhere along the line are not abiding by trumps orders, it would be the shipping companies responsibility to collect the tariffs at the Chinese port wouldn’t it? So looks like they’re not bothering, likely as china would tell them to turn the boat around and as most of their exports are food based, it would spoil and just be lost cargo.

 

[TonyCarter]

I may be misunderstanding what you're saying, but Trump's tariffs only apply to imports (i.e. goods coming into the US)...so there's no extra cost to make them in China, the extra cost is to the customer/company in the US once the product lands in the US (or goes through customs).

There is no Trump export tariff, as far as I can tell, so there's nothing to waive!

Of course there are some export bans which apply to stuff being manufactured in the US and sent China (like Nvidia AI chips)...and it's up to the Chinese customer/company as to whether they'd pay a premium (or set up a shell company) to buy the product via a 3rd party.

 

[SpyderTracks]

I may be misunderstanding what you're saying, but Trump's tariffs only apply to imports (i.e. goods coming into the US)...so there's no extra cost to make them in China, the extra cost is to the customer/company in the US once the product lands in the US (or goes through customs).

There is no Trump export tariff, as far as I can tell, so there's nothing to waive!

Of course there are some export bans which apply to stuff being manufactured in the US and sent China (like Nvidia AI chips)...and it's up to the Chinese customer/company as to whether they'd pay a premium (or set up a shell company) to buy the product via a 3rd party.

Yeah, totally get what you mean, id got myself tangled up, it’s nothing to do with trump, its chinas side that aren’t collecting

What I meant is that the tariffs are paid by the importer. So all ships hitting the US from China are being hit with tariff charges.

What the dude is saying is that China are allowing ships to dock without collecting the tariff charges.

I guess it could be taken in 2 ways.

Either China are losing out on their additional revenue and are suckers. As a result China will go into recession and US will bolster after the initial commercial uncertainty

Or China are waiving them to keep costs down for consumers which will keep exports from the US flowing while imports to the US will dry up?

Ive not looked at it this way, it does change the picture somewhat.

From an idiots perspective (definitely referring to me) surely it looks like trump is doing China a massive favour here? Remember the majority of trumps manufacturing and debt is owned by China

 

[TonyCarter]

But the ship doesn't pay the tariffs when they dock.

The customer/company receiving the products pays the US customs the duty/tax/tariff when they want the item released from the docks.

That's unless they've agreed/negotiated the DDP INCOTERM where the Chinese manufacturer pays the fees...in 99.9% of cases the INCOTERM agreed will only cover getting the product to the ship/dock at the departure port...costs from therein are on the recipient (insurance, shipping, taxes, duties, tariffs).

The common ones we use/used are, and they mostly put the costs on us as the buyer...but as a large company we'd have our own logistics/insurance agreements anyway...

• EXW – Ex Works: The seller’s responsibility is to make the goods available for pickup at the warehouse or factory. From that point forward, the buyer assumes responsibility for all costs and risks. For most importers and exporters, this means working with a freight forwarder that arranges the entire shipment, starting at pickup from the factory.
• FOB – Free On Board: The seller is responsible for packaging, pickup, and delivery of goods onto a vessel at the port of shipment. Liability transfers to the buyer once the goods are on board the vessell; the buyer is responsible for every other step of the journey.
• FAS – Free Alongside Ship: The seller is responsible for picking up the goods at the factory, clearing them for export, and delivering them to a departure location, usually the ship loading dock. Tisk transfers to the buyer when the goods are placed alongside the ship; they are responsible for the main leg of transit and every other step in delivery.
• FCA – Free Carrier: The seller is responsible for delivering the goods to the carrier at a named place, which is usually the terminal or a warehouse. Once the goods are handed over to the carrier, the risk transfers to the buyer.

The one that would be worrying to a Chinese manufacturer/seller would be DDP, as that means all costs are on the seller/manufacturer.

• DDP – Delivered Duty Paid: The seller is responsible for entire shipment, including customs clearance and fees, and delivering the goods to the buyer’s premises. This incoterm places the maximum responsibility on the seller.

More on INCOTERMs...

Incoterms Explained [2025 Ultimate Guide] | Freightos

Incoterms are the standard contract terms used in importing/exporting sales contracts. Got questions? Check out this guide.

www.freightos.com

 

[SpyderTracks]

But the ship doesn't pay the tariffs when they dock.

The customer/company receiving the products pays the US customs the duty/tax/tariff when they want the item released from the docks.

That's unless they've agreed/negotiated the DDP INCOTERM where the Chinese manufacturer pays the fees...in 99.9% of cases the INCOTERM agreed will only cover getting the product to the ship/dock at the departure port...costs from therein are on the recipient (insurance, shipping, taxes, duties, tariffs).

The common ones we use/used are, and they mostly put the costs on us as the buyer...but as a large company we'd have our own logistics/insurance agreements anyway...

• EXW – Ex Works: The seller’s responsibility is to make the goods available for pickup at the warehouse or factory. From that point forward, the buyer assumes responsibility for all costs and risks. For most importers and exporters, this means working with a freight forwarder that arranges the entire shipment, starting at pickup from the factory.
• FOB – Free On Board: The seller is responsible for packaging, pickup, and delivery of goods onto a vessel at the port of shipment. Liability transfers to the buyer once the goods are on board the vessell; the buyer is responsible for every other step of the journey.
• FAS – Free Alongside Ship: The seller is responsible for picking up the goods at the factory, clearing them for export, and delivering them to a departure location, usually the ship loading dock. Tisk transfers to the buyer when the goods are placed alongside the ship; they are responsible for the main leg of transit and every other step in delivery.
• FCA – Free Carrier: The seller is responsible for delivering the goods to the carrier at a named place, which is usually the terminal or a warehouse. Once the goods are handed over to the carrier, the risk transfers to the buyer.

The one that would be worrying to a Chinese manufacturer/seller would be DDP, as that means all costs are on the seller/manufacturer.

• DDP – Delivered Duty Paid: The seller is responsible for entire shipment, including customs clearance and fees, and delivering the goods to the buyer’s premises. This incoterm places the maximum responsibility on the seller.

More on INCOTERMs...

Incoterms Explained [2025 Ultimate Guide] | Freightos

Incoterms are the standard contract terms used in importing/exporting sales contracts. Got questions? Check out this guide.

www.freightos.com

Ah, superb, this explains it in a way I could never find out, that's amazing thank you, I didn't understand how things work at this level at all

So with a DDP contract then, I'm guessing even if you were signed up to a current term, the new tariffs would have made any existing contracts void? So if an exporter had previously agreed to say a 1 year term (which I'd be surprised if any had since 2020), that would surely be up for renegotiation?

 

[TonyCarter]

Ah, superb, this explains it in a way I could never find out, that's amazing thank you, I didn't understand how things work at this level at all

So with a DDP contract then, I'm guessing even if you were signed up to a current term, the new tariffs would have made any existing contracts void? So if an exporter had previously agreed to say a 1 year term (which I'd be surprised if any had since 2020), that would surely be up for renegotiation?

Again, it depends on the contract...but even then, there's always negotiation as it may be better value paying a penalty to exit the contract than pay the extra costs.

We've spent 10 years trying to standardise our's...and we're 75% there. Some companies/countries just refuse, and we don't have much choice in the matter as they're one of 3 companies we can buy from...and 2 of the largest are subsidiaries of the same group of companies

 

[SpyderTracks]

Again, it depends on the contract...but even then, there's always negotiation as it may be better value paying a penalty to exit the contract than pay the extra costs.

We've spent 10 years trying to standardise our's...and we're 75% there. Some companies/countries just refuse, and we don't have much choice in the matter as they're one of 3 companies we can buy from...and 2 of the largest are subsidiaries of the same group of companies

How long do your contracts run for generally?

 

[TonyCarter]

How long do your contracts run for generally?

3-10 years...with mutual break/renegotiation terms/periods built in, and commitments to PFAS, CFC, FSC, energy, waste water, etc. targets.

There's a lot of chemicals (processing), active ingredients (the drug part), non-active ingredients (the base and flavourings), packaging (boxes, cartons, pallets) and containers (glass bottles, plastic bottles, tubs, laminate tubes, alu tubes), and miscellaneous parts (droppers, spoons, spatulas, syringes, pipettes, vials, etc.) in the pharmaceutical industry.

 

[SpyderTracks]

3-10 years!

Holy gods!!!

So even if they choose just to end that market, they'll still have to pay some pretty hefty contract termination fees

Jesus. I had no idea.

The scale of the tariffs really starts to hit home when you look at it at individual cargo ship level

https://www.bloomberg.com/graphics/2025-china-ship-cost-in-tariffs-trade-war/?embedded-checkout=true

 

[TonyCarter]

In some cases, specifically China & India, the import tariffs to those countries from our European suppliers meant it was more cost-effective to set up a local supplier manufacturing site (or pay a 3rd party to do so) to avoid the tariffs…which is what I assume Trump is trying to force.

Unfortunately it only works if the place you shift manufacturing to is cheaper in the first place AND the tariffs are long-term. No point investing £10m in a new site to save £1m a year for 6 months 😁

 

[SpyderTracks]

Unfortunately it only works if the place you shift manufacturing to is cheaper.

100%

BUT, this is one of the reasons he's pulled out of the human rights courts (was one of the first things he did), aside from syphoning legal citizens off to gulags abroad

https://www.npr.org/2025/02/03/nx-s1-5285696/trump-un-human-rights-council-withdrawal

The ONLY way he can get any kind of manufacturing effective within the US is to heavily reduce the minimum wage.

Bet you, he will announce that at some point, he'll probably mandate it for any "illegal aliens" which he terms as anyone non-white, non-english, and any connected relations. He'll make it seem like it's a bonus for them, that they're so lucky to be awarded $2 an hour to work in the mines instead of being sent to El Salvador or Gauntanamo

Literally exactly the same thing Hitler did with Dachau.

 

[TonyCarter]

That’s why he wants Canada’s & Greenland’s resources…as once he has cheap labour, he’ll need a source of cheap raw materials too 😁

 

[SpyderTracks]

That’s why he wants Canada’s & Greenland’s resources…as once he has cheap labour, he’ll need a source of cheap raw materials too 😁

Yeah, totally agree.

Sucks man, I can’t believe as a society we’ve let it get to this stage

 

[TonyCarter]

 

[TonyCarter]

...and yet another pharma supplier moving to China due to costs...

Europe’s last maker of key antibiotics ingredients shuts biggest domestic factory

Xellia Pharmaceuticals to close Copenhagen plant and shift some production to China

www.ft.com