THE prices of headphones, speakers, high-tech lighting and Internet service could all go up if the U.S. trade war with China continues.

The Trump administration’s hit list of Chinese products facing import taxes includes key components used in gadgets that can be wirelessly operated through a smartphone or another device. The tariffs also will nail networking equipment that makes the Internet work.

It remains unclear how much prices might rise, partly because the next round of tariffs won’t be imposed until the fall. The technology industry’s broad reach and financial heft also complicates the calculation. Apple, Google, Microsoft and other major technology companies have such diversified product lines and deep pockets that they simply could absorb the additional costs triggered by the tariffs rather than pass them along to consumers.

But even the richest companies will usually only shoulder an ongoing tax such as a tariff for so long before raising prices, said Timothy Sturgeon, a senior research affiliate at MIT’s industrial performance center.

Those prices will eventually hit consumers, Sturgeon predicted. “That’s how companies work.”

Citing national security concerns, the Trump administration has already imposed a 25 percent import tax on US$34 billion worth of Chinese goods, but the impact on electronics was mostly limited to components for TVs and video equipment.

The next volley will drop a 10 percent tariff on another US$200 billion in Chinese imports, including chips used in consumer electronics devices like those made by JLab Audio, a Carlsbad, California maker of Bluetooth headphones and speakers that connect wirelessly to phones. The administration’s proposed tariffs would affect products that generate 70 percent to 80 percent of JLab’s sales.

“Just about any wireless accessory made for a phone is going to be affected,” JLab CEO Win Cramer said. “We are going to have to start charging retailers more, and my guess is they can’t afford the haircut either. So at the end of the day the consumer is going to pick up the tab.”

If JLab passes along the entire cost of the tariffs, a pair of sports earbuds listed on its site at US$149 could end up costing US$163.90.

That might not sound like much, but Cramer says every dollar counts in a fiercely competitive audio market. JLab could suffer if one of its main rivals, Beats, doesn’t also raise prices. Beats is owned by Apple, whose enormous iPhone profits could easily cover the cost of tariffs on Beats headphones. “I don’t have anything else to lean on,” Cramer said.

Apple didn’t respond to requests for comment. Other big companies with products and services that could be affected by the next round of tariffs, including Google and Microsoft, either declined to comment or didn’t respond to inquiries.

Stock market investors so far don’t seem to be concerned about the tariffs hurting big tech companies.

(SD-Agencies)