During this busy holiday shopping season, some bargain hunters may be wondering if this is the ideal time to stock up on items before they could cost a lot more.
That’s because there are only months left before President-elect Donald Trump gets back in the White House, where he’s promised to enact steep tariffs on imports. While there’s a lot we don’t know about his plan, one thing seems pretty clear: Tariffs will go up. And if history is any guide, that means price increases will likely follow.
Trump has said he’ll slap a new 25% across-the-board tariff on imports from Mexico and Canada as well as an additional 10% tariff on Chinese imports starting on Day 1.
On the campaign trail, he pledged a 60% tariff on goods imported from China and a 10% to 20% tariff on goods from other countries.
Trump’s threats might simply be negotiating tactics, not concrete plans. But if tariffs do happen, we don’t know, for instance, how long they’ll last and if there will be exclusions.
So it’s not too early to start planning ahead — your wallet may thank you later.
But there are some caveats.
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For one thing, you can only buy so many imported fruits and vegetables before they go bad.
And as pandemic-era toilet paper hoarding showed, “stockpiling by consumers can actually lead to higher prices in and of themselves and empty store shelves,” said Scott Lincicome, vice president of general economics and trade at the libertarian Cato Institute.
Here’s what you might want to put on your holiday shopping list now to get ahead of possible tariffs.
IPhones and other smartphones
IPhones are a holiday favorite, as evidenced by Apple's (AAPL) sales data, which often shows a significant bump in the quarter as people replace their phones with the latest model.
And it’s not just iPhones. All kinds of smartphones (and other electronic gadgets) draw shoppers in droves during the holiday shopping season.
Currently, very few smartphones are manufactured in the United States. China accounts for 78% of US total imports, according to a recent analysis commissioned by the Consumer Technology Association report.
Moving smartphone production to other countries, including the United States, where very few are currently made, could push prices up substantially.
But a 10% across-the-board import tariff, plus the additional 60% on Chinese goods, could cause the price of a new smartphone to rise by 26% to $213 and would likely go even higher if there’s a 25% blanket tariff on imports from Canada and Mexico, CTA reported.
After supply chain issues during the pandemic, however, Apple has shifted some of its iPhone production out of China and more of it to India.
Vacuums, hair dryers and kitchen appliances
A 10% tariff on all imports and an additional 60% tariff on imports from China would boost the price of the average household appliance by 19.4%, assuming retailers fully pass on the additional cost to consumers. That’s according to an analysis commissioned by the National Retail Federation, a trade group representing retailers.
That means, for instance, a new $40 toaster would cost about $48.
The same price hike applies to other household appliances, including hair dryers, vacuums and even larger items like washing machines, according to the NRF report.
That doesn’t mean you should rush to buy one. But if you need a new one —– or will soon — now’s a good time to consider buying.
“In retrospect, if you were in dire need of a washer and dryer in 2017, I would have said, ‘Buy that sucker right now; don’t wait because next year it’s gonna be 20% more,’” Lincicome said, looking back on a 20% tariff on imported washing machines Trump put in place in 2018.
Gaming accessories
The price of a new gaming console could go up by nearly 40%, just taking into account the 10% tariff on all imports and an additional 60% on Chinese goods, the CTA estimated. That would bring the average price of a gaming console up by $246.
That’s primarily because China is the major supplier of consoles, accounting for 87% of US video game console imports last year, according to the CTA-commissioned report. Few alternatives exist for moving production, the authors wrote. And tapping the few alternatives comes at a steep cost.
Another device that could become more expensive is a computer monitor, which could jump by over 30% under Trump’s tariff plan, according to CTA estimates. That would mean the average computer monitor would cost about $100 more.
Portable electronics
Similar to consoles and smartphones, very few laptops and tablets are manufactured in the United States.
A 10% across-the-board import tariff plus the additional 60% on Chinese goods could result in a 45% increase in the consumer prices for laptops and tablets, according to CTA’s report. On average, that would mean consumers pay $357 more for laptops and $201 for tablets.
“There’s very little in the consumer electronics space that is not imported,” Best Buy (BBY) CEO Corie Barry said on the company’s earnings call last week. “The customer ends up bearing some of the cost of the tariffs. These are goods that people need, and higher prices are not helpful.”
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Shoes
NRF estimates some of the new tariffs Trump proposed could make the price of some shoes go up by at least 18%, as brands consider moving to new manufacturing countries to save on costs.
That means a running shoe that costs about $90 could go to $106.
Already, Steve Madden is trying to shift some of its shoe manufacturing out of China to avoid new tariffs.
Toys
Buying toys for any kids (or kidults) in the future? Be prepared to potentially shell out a lot more money.
If some of the new tariffs Trump has proposed go into effect, the price of some toys could rise by 36%. Like many electronics, several toys have been excluded from existing tariffs. But since China roughly accounted for more than 77% of total toy imports last year, a hefty broad-based tariff on Chinese goods would significantly raise prices, according to NRF.
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