Barcelona | US president announced he will target major trading partners with punitive tariffs. The Trump administration will punish Canada, Mexico and China with tariffs ranging from 10-25%. The EU will be next on the list. Industry experts expect a relevant negative impact on demand for screens, LED and media player.
President Trump remains true to his policy of using tariffs as a tool to dictate his terms of “America First” to the world – enemies and allies alike. The countries selected – Canada, Mexico, China and next the EU represent 60% of all import of goods into the US.
The US administration threatens to ignite an era of trade wars with new tariffs.
For the North American digital signage industry tariffs on goods from China and Mexico could bring considerable disruption. In recent years large display manufacturers set up factories in Mexico to benefit from the North American free trade zone. By far the most digital signage hardware is manufactured in China – especially SMD LED, components and media players.
Certain digital signage hardware – like Brightsign players or Samsung The Wall – is assembled in Vietnam and would not be targeted by the first rounds of tariffs. Also Samsung and LG could start shipping digital signage displays from factories in Indonesia or Malaysia to the US to omit additional tariffs. Biggest challenge remains SMD LED, which is mainly manufactured in mainland China.
Experiences from the first Trump era
The digital signage industry can already build on experiences from the first Trump presidency. Back then, the US administration imposed also punitive tariffs on electronics from China. The tariffs brought some American ProAV manufacturers to the brink of bankruptcy. Only Covid and the associated government subsidies were able to save the companies.
One trick that allowed the flow of goods from China to the USA to continue without additional tariffs was the USD 800 limit. Similar to Temu and Shein, small shipments were not subject to the sanctions. This exemption limit was also removed yesterday – thus the loop hole used at the time of importing high-priced components such as processors separately is no longer available.
Services and software is currently not targeted – that means that digital signage software vendors are not directly threatened. But indirectly ISVs could also feel the impact on tariffs, as hardware becomes more expensive and roll-outs are being postponed.
Tariffs for goods from Mexico, Canada and China will be imposed starting Tuesday. The EU must expect tariffs from Trump, too. “We are going to do something very significant with the European Union,” Trumpe announced, without giving any details.
Without a doubt the new tariffs will be one of the hottest topics at ISE in Barcelona next week.
Services are not subject to tariffs, they are subject to trade barriers such as nationality and local presence requirements or other regulatory processes. These barriers practically limit access for international digital signage service businesses to provide installation and on site services. Software providers are also exempt from tariffs, but international ISVs are concerned that a local presence may become necessary to conduct business in the future.
Update 03FEB: Trump says tariffs on EU ‘will definitely happen’
On Sunday Donald Trump announced that the US would definitely impose tariffs on the EU in the wake of his levies on Canada, Mexico and China. Adding the EU and possible the UK to the sanctions list would cover almost 2/3 of all imports into the US. The disruption in global trade could be very serious.