(Allison Robbert/AFP/Bloomberg via Getty Images)
If you need another reason to shop this Black Friday, President-elect Donald Trump is threatening to impose tariffs on imports from Mexico and Canada as soon as he takes office, potentially driving up prices on electronics next year.
On Monday night, Trump issued the trade threat to pressure the countries into stopping the flow of illegal drugs and immigrants across their borders.
“On January 20th, as one of my many first Executive Orders, I will sign all necessary documents to charge Mexico and Canada a 25% Tariff on ALL products coming into the United States, and its ridiculous Open Borders,” Trump posted on Truth Social. “This Tariff will remain in effect until such time as Drugs, in particular Fentanyl, and all Illegal Aliens stop this Invasion of our Country!”
In another post, Trump also threatened to impose more tariffs on imports from China, blaming the country’s government for failing to stop fentanyl drug trafficking into the US. “Until such time as they stop, we will be charging China an additional 10% Tariff, above any additional Tariffs, on all of their many products coming into the United States of America,” he wrote.
The posts offer an early preview of how Trump plans to implement his tariffs, which work as a tax that companies need to pay to import goods into the US, thus increasing the price. On the campaign trail, Trump proposed levying a 10% tariff on all foreign imports and another 60% tariff on Chinese goods, with the goal of spurring manufacturing in the US.
However, Mexico and China are currently home to many electronics factories. For example, Foxconn, the iPhone maker and contract manufacturing giant, has factories in both countries. Samsung and LG also have plants in Mexico, according to IVEMSA, a consultancy that helps companies migrate their manufacturing to the country.
“Mexico has over 730 plants manufacturing audio and video, telecommunications, computer equipment, and related parts. It is the largest exporter of flat-screen TVs in the world, the third-largest exporter of computers, and the eighth-largest producer of electronics in the world,” IVEMSA added.
As a result, Trump’s tariff threat risks raising prices on many consumer electronics, though some Trump backers say his latest trade threat is more of a negotiating tactic.
“To be clear, according to Trump, the 25% tariffs will not be implemented, or if implemented will be removed, once Mexico and Canada stop the flow of illegal immigrants and fentanyl into the US,” Bill Ackman, a billionaire hedge fund manager, speculated on X. “This is a great way for Trump to effect foreign policy changes even before he takes office."
It’s also possible the Trump administration will grant exemptions to his tariff policy, which companies will be able to apply for —a US policy that tech vendors have taken advantage of before. In the meantime, Mexico's President on Tuesday called for dialogue with Trump to prevent a trade war involving escalating tariffs.