IPC International Community magazine an association member publication
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IPC COMMUNITY 20 WINTER 2025 competitive positions, and overall industry stability. A substantial proportion of electronics manufacturers (38%) intend to pass the full cost increase on to their customers, while another 19% plan to share some of the added expense, pass- ing part of it along and absorbing some internally. Only a small minority (4%) expect to absorb the entire cost without raising prices. This distribution of strat- egies suggests that most firms believe at least some of the tar- iff-induced costs will need to be transferred to end-users. Looking ahead, the global trade environment appears increasingly uncertain. President Trump's pro- posed tariffs—ranging from broad- based levies on all imports to tar- geted increases on goods from key partners—signal a departure from the status quo. As shifting trade dynamics place Mexico and Canada more prominently on the U.S. import roster, the potential for retaliatory measures looms large. The resulting tensions threaten not just raw trade vol- umes, but also consumer wal- lets, corporate bottom lines, and delicate geopolitical equilibria. Amid this uncertainty, smaller "bystander" nations stand poised to gain, capitalizing on trade diversion as world powers vie for leverage and control. In the electronics manufactur- ing sector, concern and appre- hension are palpable. While some firms intend to pass the costs on to customers, others may absorb part of the burden themselves. As policymaking unfolds and retalia- tory postures evolve, both indus- try players and consumers will be forced to adapt. Ultimately, the path forward will depend on how swiftly and wisely the U.S. and its trading partners navigate this del- icate era. Research to date offers crucial lessons: Tariffs often pro- duce unintended consequences and understanding who truly bears these costs will be essential for informed decision-making in a complex, interconnected global economy. References 1. "The US-China Trade War and Global Reallocations," by Pablo Fajgelbaum, Pinelopi Goldberg, Patrick Kennedy, and Amit Khan- delwal, National Bureau of Eco- nomic Research, December 2021 (revised December 2023). 2. "Who Pays for the Tariffs and Why? A Tale of Two Countries," by Chaonan Feng, Liyan Han, and Lei Li, CESifo Working Papers, June 2023.