Lenovo PCs getting more expensive thanks to tariffs
Lenovo warned than an increase in tariffs would raise retail prices for its products
China’s Lenovo Group, the world’s largest PC maker, warned it will have to raise product prices if U.S. tariffs increase, sending its shares tumbling 6.5% to two-month lows.
Lenovo’s warning amid mounting business uncertainty due to the U.S.-China trade war cast doubt on its sales outlook and took the shine off forecast-beating quarterly results where robust PC sales helped the company more than double its profit.
U.S. President Donald Trump said this week that he would postpone imposing an additional 10% tariff on Chinese-made products including tablets and laptop computers until December, but would still impose the tariffs on desktops from September.
“Retail prices for products like PC and smartphones will increase if (U.S.) tariffs increase,” Lenovo Chairman Yang Yuanqing told an earnings call on Thursday.
He also said shifting manufacturing from China to avoid U.S. tariffs would also lead to product price increases, although Lenovo’s global production footprint gives it flexibility in making adjustments, and it remains committed to China.