Trump administration tariffs may lead to decline in physical game disc production and increased game costs

Analysts have warned that the newly implemented tariffs by the Trump administration could impact production of physical game discs, to the point where publishers and developers forgo physical copies of their games altogether. The tariffs that came into effect on March 4 are targeting US imports from Canada, Mexico, and China, with Mexico seemingly being the major producer of these game discs.

Circana analyst Mat Piscatella shared on social media platform Bluesky that even though video games are a very small piece in the chaos that has ensued following the introduction of the tariffs, it would not be a surprise if physical games “simply not get made” anymore. Publishers will likely take the digital-only approach and stop selling physical copies of their games, the analyst added.

Back in January, Piscatella stated that much of the physical game disc production happens in Mexico and following the 25% tariff on imports from Mexico to the US, there will likely be a decline in the number of games on discs that enter the US market. For games that do get discs, their prices would be higher, even for the digital copies to maintain price parity. Furthermore, the production of these game discs could move to the US but that would require significant investment but US physical video game software spending has been on a decline since 2021.

As for hardware, a similar impact is predicted as reportedly 75% of all consoles sold in the US are imported from China. Now, with the 20% tariff, the costs could increase at some point in the future. Ideally, till the pre-tariff import inventories run out, PC hardware and consoles will likely maintain their current pricing. Interestingly, earlier in February, Newegg had reportedly blamed the tariffs for the increase in Nvidia GeForce RTX 5080 and RTX 5090 GPU prices through a post on X, but those posts have since been deleted.