The Switch 2 is shaping up to be one of the messiest console launches ever in the U.S., at least from Nintendo’s point of view. The company’s new $450 console is set to come out on June 5, but it’s also being forced to navigate a chaotic circus around tariffs that could torpedo the rollout at any moment. Bloomberg now reports that the Mario maker has been diverting Switch 2 shipments to stockpile them in the U.S. before tariffs potentially skyrocket again, but even in the current environment some analysts believe Nintendo would be selling the console at a potential loss.
Vietnam, where the majority of Switch 2s are manufactured, was set to be hit with a 46 percent tariff earlier this week, but President Trump backed off at the last minute as the stock and bond markets went into freefall. Those “reciprocal” tariffs, including 49 percent on Cambodia and 24 percent on Japan, were paused for 90 days, and replaced in the meantime with a flat 10 percent tax across the board. While a new astronomical 125-percent tariff on China still threatens to spike prices on a range of goods, Trump’s retreat was a temporary reprieve for the Switch 2 whose preorders had previously been halted in the U.S. due to the uncertainty.
It now appears that Nintendo has been moving extra Switch 2 shipments to the U.S. in recent months to try and get ahead of the current and upcoming tariffs. “Hosiden Corp., one of three main Switch 2 assemblers, shipped more devices in February to the US from Vietnam than in the previous six months combined, according to customs data provided by NBD,” reports Bloomberg, noting that with those numbers Nintendo could “stockpile millions of consoles from the Southeast Asian country in time for the June launch.” The amount of Switch 2 production going from Hosiden to the U.S. jumped from 11 percent to over 60 percent by earlier this year.
So even if the 90-day pause runs out and major tariff hikes on places where the Switch 2 is assembled come back, it’s possible Nintendo could have a decent enough inventory to satisfying at least some of its most hardcore early adopters at launch and through the summer. But according to at least one analyst’s estimates, Nintendo would still be selling the console at a loss during that period if it doesn’t raise the price due to the existing 10-percent import tax.
“We believe the Switch 2’s bill of materials is around $400, meaning Nintendo would still be selling consoles at a loss in the US with the 10% tariff but the loss would be something Nintendo would be able to absorb,” Toyo Securities analyst Hideki Yasuda told Bloomberg. He notes that gaming companies who still rely mostly on China for console manufacturing, like Sony with the PS5, are in a completely different situation and would likely need to start raising the price soon if Trump’s trade war continues.
One of the administration’s stated rationales for shaving trillions off the stock market earlier this week was to try and boost manufacturing in the U.S. But experts don’t see the Switch 2 being made in Wisconsin or Alabama anytime soon. “Such a move would take years,” New York University Stern School of Business economics professor Joseph Foudy told Polygon this week. “Nintendo would have to set up a final assembly factory in the U.S., which means finding land, building a facility, and recruiting a workforce.”
Plus who would want to commit years of planning and hundreds of millions in setup costs to get around trade policy that shifts on a dime? That’s not the Nintendo way.
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