Will Tariffs Increase Switch 2's Price? Why The Console And Games Are So Expensive

Nintendo recently unveiled the Switch 2, and a key detail that stood out to many was its cost: $450 for the standard model and $500 for one bundled with Mario Kart World. The announcement was made during Nintendo’s big Direct event on April 2, which coincided with US President Donald Trump initiating his “Liberation” tariffs that have affected numerous countries. With speculation swirling about the potential effects on the Switch 2, here is what we currently understand and some reasons behind the higher price tag for the new console.

Table of Contents [hide]

Nintendo Will “Feel The Impact” Of Tariffs
“All Anyone Can Do At This Point Is Speculate”
Could Nintendo Produce Switch 2 Units In The USA?
So, Why Is The Switch 2 So Expensive?
Game Price Hikes, Too
How Well With The Switch 2 Sell?

Nintendo Will “Feel The Impact” Of Tariffs

According to analyst Daniel Ahmad from Niko Partners, Nintendo might experience the effects of tariffs in manufacturing regions like Vietnam and Japan for the upcoming Switch 2 consoles. However, it’s unlikely that Nintendo will increase the cost of the Switch 2 due to these tariffs. On the other hand, Ahmad doesn’t anticipate a price reduction for the Switch 2 before the year 2030.

Ahmad stated that the unexpectedly high tariffs for Vietnam and Japan might have compelled Nintendo to think about a more expensive price for the Switch 2 outside of Japan, given the potential for reciprocal tariffs before the Switch 2 unveiling. However, it’s uncertain if these tariffs will be fully implemented, possibly alluding to the volatile nature of Trump’s policy changes.

Upon request for comment, a representative from Nintendo chose not to discuss the potential effects of Trump’s fresh tariffs on the markets where Switch 2 is slated for release. Instead, they stated that if any price adjustments occur, they would be sure to inform the public.

David Gibson, an analyst at MST Financial, informed FT that Nintendo shipped approximately 350,000 Switch 2 units to the United States from Vietnam as early as January, in order to avoid tariffs. According to Gibson, it’s likely that Nintendo increased its shipments from Vietnam to the USA significantly during February and March for the same reason.

According to Piers Harding-Rolls from Ampere Analysis, it is unlikely that Nintendo will adjust the price of the Switch 2 before 2026. This is because making a change to the price could significantly interfere with its launch.

As a passionate gamer, I’m sharing some thoughts about the future. If these tariffs continue, it seems like we might see a price hike for games in 2026. Nintendo, being mindful of the significant US market, could be cautious with their moves. They might choose to absorb some loss on hardware profits and instead focus on expanding their eShop business. This could help them balance any financial strain by boosting digital sales. Additionally, they might explore more avenues for in-game monetization to generate income.

As a gaming enthusiast, I’d express it this way: According to Harding-Rolls, US tariffs on imports pose a significant risk to the console market within the U.S., causing companies like Sony, Microsoft, and Nintendo to worry and strategize on ways to safeguard their hardware profitability. He further suggests that these tariffs might prompt these giants to prioritize digital content and gradually transition away from physical products.

“All Anyone Can Do At This Point Is Speculate”

According to Mat Piscatella from Circana, the current circumstances surrounding tariffs and their influence on video games are unpredictable and disorderly, meaning that anyone predicting the outcome might be speculating prematurely.

He shared with TopMob that at this stage, everyone can only make educated guesses about what might occur next. We’re in uncharted territories indeed, where we don’t have a clear picture of the future developments. The announced tariffs are causing an instant ripple effect within the financial markets. Since the methodology behind these tariffs seems to be somewhat erratic, the one thing that is certain right now is the presence of uncertainty.

According to Piscatella, it’s possible that the recently implemented tariffs, along with any further tariffs in the future, could potentially bring about changes for various consumer goods, not only for Nintendo, but for all companies involved.

Currently, manufacturers, publishers, and retailers are figuring out their responses. It remains uncertain when any price adjustments might occur due to these tariffs, but considering the scale of the taxes, it’s likely that some modifications will take place. We can only anticipate how significant those increases might be and which products may be affected. Time will tell.

Regarding the Switch 2, Piscatella expressed confidence that the console will continue to perform well, even if a price hike occurs in the future. He’s not concerned about sales of the console in 2025 because, considering the scarcity during its launch and potential shifts in distribution across regions, there will be plenty of dedicated fans and higher-income buyers who will snap up the console in the US this year.

“We’ve never seen anything like this happen in any of our lifetimes.” — Mat Piscatella

During the second year of the Switch 2, according to Piscatella, it might become a more challenging period. Unlike the initial year which primarily attracted the enthusiast community, the subsequent year is when Nintendo aims to appeal to a broader audience, or mass-market buyers. However, Piscatella pointed out that there are many uncertainties regarding the US market in 2026, making it difficult to predict a specific outcome with certainty.

In all our lives, we’ve never witnessed an event quite similar to this. There are no comparable occurrences in recent history for us to predict the possible consequences, and nobody can accurately foretell what will transpire next.

Could Nintendo Produce Switch 2 Units In The USA?

An idea circulating online is that Nintendo could potentially dodge tariffs by manufacturing Switch 2 consoles within the United States. Trump has stated that tariffs are being enforced in order to boost American manufacturing overall. In 2024, tariffs brought in approximately $80 billion for the U.S., with Trump aiming for more. Nevertheless, Ahmad highlighted that it’s impractical to rapidly establish a complete production system on such short notice. By the time any potential U.S. factories for Switch 2 could be operational, there might be a new president in office with different tariff policies.

Ahmad stated that for Nintendo to establish a manufacturing facility in the U.S., it would likely require several billion dollars as an investment. This process could take around 4-5 years to fully set up. Additionally, they would face the challenge of rebuilding their supply chain infrastructure, sourcing components (many of which may be subject to tariffs since they are not locally produced), and finding, training, and compensating workers to manage the factory.

As a fervent supporter, I’d say: “Imagine this scenario: If Nintendo were to manufacture their next console, the Switch 2, in the United States instead of Vietnam, they would need to pay their workers 10 to 15 times more. When you factor in initial investments, labor costs, supply chain expenses, and operational costs, it’s clear that the price tag for a US-made Switch 2 would soar above $450 within five years. But here’s the twist: by the time they’ve managed all this, we might well have a new president in office who could very likely abolish all reciprocal tariffs, making the higher cost even less appealing.

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So, Why Is The Switch 2 So Expensive?

According to Serkan Toto, a video game analyst at Kantan Games, it is plausible that Nintendo took into account tariffs when setting the $450 price for the Switch 2. Furthermore, he speculates that the increased cost could be influenced by current global inflation and Sony’s plan to sell the PS5 Pro for approximately $700 in the US in 2024.

Sony’s PS5 Pro, in contrast, is primarily intended for enthusiasts seeking the latest and most advanced PlayStation model, regardless of cost, while Nintendo’s upcoming Switch 2 is focusing on attracting a broader audience and offering a system that may not prioritize top-tier specs.

The potential cause for the high cost of the Switch 2 could be tariffs, according to some, but Toto asserts that Nintendo’s primary motivation is simply good business strategy. In his opinion, Nintendo sets such a high price due to their confidence in their ability to sell it at this rate.

Analyst and professor Joost van Dreunen, on the other hand, explained that the estimated $450 price for the Switch 2 takes into account increased manufacturing expenses and potential tariff concerns. In addition, Harding-Rolls stated that a price of $450 is reasonable considering the current market value of the Switch OLED, which retails at approximately $350.

Harding-Rolls hypothesized that Nintendo may not have disclosed the $450 price tag during the Nintendo Direct presentation, as the company could have been weighing alternative pricing options and wished to make a final decision closer to the event, taking into account the impending tariffs.

According to Piscatella, a potential consequence of the new tariffs might be that the video game console market would tend to attract older and wealthier customers.

Game Price Hikes, Too

As a devoted fan, it’s not just the anticipated increase in the price of the Switch 2 console that has me raising an eyebrow–it’s the potential rise in prices for Switch 2 games as well. The digital edition of the flagship launch title for the Switch 2, Mario Kart World, is priced at a hefty $80 USD–that’s a significant jump of $10-$20 over the standard price for new AAA games today. Nintendo hasn’t offered an explanation or defense for this higher price point, but according to Van Dreunen, they’ve crunched the numbers and believe that the massive fanbase of Mario Kart will be willing to pay a premium for what seems to be a substantially enriched experience compared to previous installments.

It seems that Mario Kart World represents a noticeable improvement over Mario Kart 8, as suggested by our initial experience with the game.

Nick Arran from UK retailer Game stated in an interview with The Game Business that the price of Mario Kart World appears costly, yet he pointed out that video games were significantly more expensive 30 years ago when taking inflation into account. For instance, Mario Kart 64 for the N64, launched in 1996, was priced at $60, which equates to over $100 today. Arran suggested that video game prices should rise due to escalating costs. He acknowledged Nintendo’s initiative as courageous but admitted, “It is necessary for this change to occur.

From Piscatella’s viewpoint, it appears that if tariffs are applied, the general trend for game prices could be an increase. Yet, it’s important to note that these increases might not be uniform or constant across the board, as he pointed out.

Piscatella anticipates a larger shift towards free-to-play and live service games among consumers due to rising costs in everyday expenses, particularly food. Furthermore, he predicts an accelerated decrease in the sales of physical software as they may become more expensive compared to digital versions. However, it’s uncertain whether all these predictions will come true.

It’s worth noting that Nintendo has a unique approach compared to its competitors, often sticking with its prices rather than reducing them easily – for instance, The Legend of Zelda: Breath of the Wild is still retailing at its original price tag of $60.

How Well With The Switch 2 Sell?

Based on predictions from various sources like Circana, Niko Partners, and Ampere Analysis, it’s anticipated that Nintendo will sell approximately 4.3 million Switch 2 consoles in the U.S. by the end of 2025. Globally, shipments could reach up to 14.5 million units by the same year, according to Niko Partners. Ampere Analysis, on the other hand, forecasts global sales of around 13 million Switch 2 consoles in 2025, with this number potentially rising to 31 million by the end of 2026. All these predictions stem from data provided by The Game Business.

Compared to its predecessor, it’s anticipated that the Switch 2 might not sell as many units in its initial year. Experts have been predicting this underperformance compared to the original Switch for some time now.

On June 5, the official release of the Switch 2 takes place. Be sure to stay tuned to TopMob, as we’ll be providing plenty of additional information about the Switch 2 in the near future. In the meantime, take a look at TopMob’s early review of the Switch 2.

2025-04-03 20:11

Will Tariffs Increase Switch 2’s Price? Why The Console And Games Are So Expensive