Game Console Prices Rise amid Tariff Pressure and Industry Challenges

The global cost of major gaming consoles such as Sony’s PlayStation 5 and Microsoft’s Xbox Series X has surged by tens of dollars, a rare trend that bucks the typical pattern of tech products becoming cheaper over time. Analysts attribute this rise to U.S. tariffs imposed under former President Donald Trump on imports from key trade partners like China.

According to market research firm Niko Partners, around 75% of all game consoles shipped to the U.S. in 2023 were manufactured in China. The firm’s analyst Daniel Ahmad explained that Microsoft’s worldwide price increase is intended to offset the direct impact of U.S. tariffs, with the American market being its largest.

Nintendo appears to have evaded a major price surge for its upcoming Switch 2 console, expected to launch on June 5. The Japanese company relocated part of its production to Vietnam in 2019, a country facing delayed U.S. tariffs of up to 46%. If those duties are enforced, the production cost for each console could rise by hundreds of dollars, warns gaming expert Christopher Dring.

While the U.S. and China recently agreed to a 90-day reduction in tariffs, its long-term impact on the gaming industry remains uncertain.

Beyond hardware, software prices are also climbing. Nintendo's new flagship game, Mario Kart World, will launch at a record $80 in the U.S. and €90 in Europe. Microsoft plans to follow suit, raising prices on first-party titles to $80.

Niko Partners anticipates this pricing model becoming the industry norm within two years, driven by slow growth and rising development costs that have tripled since 2020. Consumers, especially younger players, are adjusting by becoming more selective with purchases.

Some are skipping expensive new consoles altogether, while others are embracing indie games or subscribing to monthly services that offer access to a wide catalog of games for around €15.

Despite the increases, industry analysts argue that games are still relatively affordable when adjusted for inflation. For example, the PlayStation 3's 2007 launch price of €600 would now exceed €700 in today’s money.

Consultant Matthew Ball notes that real prices for games are historically low, though the cost of making them has risen significantly. He predicts that Grand Theft Auto VI, despite potentially breaking the $100 price mark at its 2026 release, would still be the cheapest GTA title ever in real terms.