At the CES show, Chinese tech worried but not panicked by Trump’s customs duties

Chinese companies came by the dozen to the CES technology show, despite the threat of new customs duties made by Donald Trump, which concerns them without causing them to panic.

The automobile manufacturer XPeng and its flying vehicle or the media equipment giant TCL and its talking television made a lot of noise this week in Las Vegas, but behind these standards, the CES aisles were peppered with other representatives of Chinese tech.

According to Gary Shapiro, president of the Consumer Technology Association (CTA), at the helm of CES, organizers have not observed significant cancellations since the election of Donald Trump as president of the United States.

The future American head of state has promised to impose additional customs duties of 60% on Chinese products imported into the United States.

“We are worried about Trump’s policies, but we think it will not last,” says Mekia Yang, of the start-up Jitlife, which manufactures motorized suitcases in Guangdong province.

“Trump will perhaps play it tough at the start, but he could then evolve under pressure from consumers,” she anticipates, “because the customs duties will raise prices and the Americans will complain.”

“We are not going to change our prices, but our customers will pay customs duties” and pay more, predicts a representative of the Chinese Dianwei, specializing in connectors.

– Exit plan –

When in doubt, Mammotion Technology, which designs autonomous lawn mowers, prefers to anticipate.

“We are working on a plan to move our production equipment out of China to other countries, such as Thailand, Vietnam and other Asian nations,” explains Zhanbin Ao, sales director.

“Once this is done, customs duties will no longer be a subject for us,” he adds.

Concern is also felt on the American side, particularly among the utility vehicle giant Oshkosh.

“Our supply chain is global,” describes its general manager John Pfeifer. “If these customs duties affect us, we will probably have to reconfigure part of it.”

“If this is not possible, we may change the design or be forced to pass on the increased costs to the consumer,” he warns.

In 2023, the United States imported some $427 billion in Chinese goods, a figure nevertheless down 20% year-on-year, the lowest in eleven years.

A decline that several economists interpret in particular as the manifestation of a diversification of global production, which has notably benefited Mexico, threatened with 20% customs duties by Donald Trump.

“These countries to which we are going to impose customs duties will respond, and our exports will suffer,” warns Gary Shapiro.

“If you have a significant (technological) advantage, you can avoid too big a blow,” said Li Yi, general manager of laser specialist Appotronics. “If people still consider your product to be (technically) competitive, they will continue to buy it.”

“If you have a basic product”, without technological differentiation, “this is going to be more of a problem for you”, adds the manager.

“If new customs duties are introduced,” says Li Yi, “this will push Chinese companies to focus on intellectual property, innovation,” to stand out other than through their low prices.

Haojia Dengyang, from the Chinese company Shenzhen Haoqitansuo Technology, which notably sells protective cases for smartphones under the Torras brand, shares this diagnosis.

He does not fear customs duties, “because our products are useful”, he says of Torras, of which the United States is the main market, “they provide a real service to people”.

Many American importers seem to agree, notably those who expressed interest in Jitlife on the sidelines of CES.

Whatever happens, “the American market will remain very important for Chinese companies,” according to Mekia Yang, “and trade between the two countries will remain significant.”

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