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Comment by ryao | Hacker News Reader

GPUs reportedly will be immune to tariffs if assembly moves to Canada or Mexico, even if they incorporate Chinese components that would qualify for tariffs if directly imported into the U.S. for use in graphics card assembly:

https://semianalysis.com/2025/04/10/tariff-armageddon-gpu-lo...

If assembly moves to Canada or Mexico, their much lower tariffs on foreign components should apply, so their governments would have a share of GPU revenue from sales of GPUs in the US.

Finally, because the components will be tariffed if imported into the U.S. for assembly, the effect of U.S. tariffs makes it cheaper to build things in Mexico and Canada, which seems contrary to their purpose.

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> GPUs reportedly will be immune to tariffs if assembly moves to Canada or Mexico

Quoting the linked article:

> as long as his March 7 executive orders remain in effect

Good luck. Everything is changing every day with this US government.

How do tariffs affect finished graphics cards assembled in China? Is the tariff set based on the expected retail price, the BOM + assembly costs, or something else? If it is set based partly on BOM, would components with different countries of origin be tariffed at lower rates?

> How do tariffs affect finished graphics cards assembled in China?

It's largely complicated.

What is assembled in China? A graphics card (or anything) is made up of many smaller parts. Some of it might have US-based parts, made up of non-US based parts. Tariffs happen on import (when someone buys something). So for each part this would need to be paid too.

That aside, if you ask me, the cheapest way is to get rid of US jobs. Remove the US parts so you have a 100% non-US product. 0% tariff so far. For US-only sales have it assembled shipped to a country like Singapore or Australia with 10% tariffs to package and re-label. When you ship from say Singapore to US, the buyer fills in the tariff code with country of origin Singapore. Case closed. 10% tariffs.

i.e. are you sure US wins?

What's next? Inspect every import to verify its country of origin? It'd clog up the ports.

Since Trump's 1st tariff on China, 100s of billions have been imported without tariffs. It's happening and continues to happen.

  That aside, if you ask me, the cheapest way is to get rid of US jobs. Remove the US parts so you have a 100% non-US product. 0% tariff so far. For US-only sales have it assembled shipped to a country like Singapore or Australia with 10% tariffs to package and re-label. When you ship from say Singapore to US, the buyer fills in the tariff code with country of origin Singapore. Case closed. 10% tariffs.

I did not ask, but this does not make any sense to me. As per the following article, this trick where the country of origin changes based on assembly only applies to Canada and Mexico, not Singapore or Australia:

https://semianalysis.com/2025/04/10/tariff-armageddon-gpu-lo...

It is unclear how removing U.S. components from products would reduce U.S. tariffs.

Excluding your “remove US components idea”, it is clear to me that China is losing in such a scenario, since they cannot tariff the non-Chinese components anymore and the Chinese components would be subject to tariffs in the country of assembly. To be clear, I do not know to what extent they enforce tariffs on non-Chinese components, but I have read of them placing tariffs imports from other countries, which could affect the components made in those countries.

> not Singapore or Australia

These only have 10% reciprocal tariffs applied so I used it as the example. Paying 10% is a lot easier than dealing with the Canada and Mexico deal, which is more likely to change.

> It is unclear how removing U.S. components from products would reduce U.S. tariffs.

US components need to pay tariffs since the US cannot produce that component whole in the US completely. Removing them makes it cheaper.

> it is clear to me that China is losing in such a scenario, since they cannot tariff the non-Chinese components anymore

Why do they want that? Who wants tariffs? Every economist says that random use of tariffs has an adverse impact.

China hasn't been paying tariffs to the US either. Most proper engagements have been re-routing. Only US small businesses suffer (since re-routing is harder for small businesses).

You will just have to keep going to those 1mil/pop dinners at maralago https://www.npr.org/2025/04/09/nx-s1-5356480/nvidia-china-ai...

Yep. US investment and manufacturing will cease entirely with instability.

Being bad for business, it's more likely now that the economic royalists will find a way to remove POTUS by impeachment and conviction for one of his many alleged crimes by turning COTUS against Dear Leader through economic and political pressure. The billionaire class has a much deeper bench and bigger war chest than the Musk-Trump duumvirate.

> The billionaire class has a much deeper bench and bigger war chest than the Musk-Trump duumvirate

Musk has already left the scene...

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