Micron increases prices on SSDs and memory products in response to tariffs

Micron hikes SSD and memory prices due to tariffs, as Trump raises China tariffs to 125%.

: Micron Technology announced it will apply a surcharge on certain products starting Wednesday, responding to new tariffs introduced by President Trump. Though semiconductors were exempt, memory modules and solid-state drives faced tariff implications. Micron's letter to US clients explained the necessity of this surcharge due to these new trade conditions. The tariffs impact countries such as China with a combined effective rate of 104%, heavily affecting Micron's extensive Asian manufacturing footprint.

Micron Technology, a major player in the semiconductor industry, is taking significant measures in response to new tariffs imposed by the Trump administration. Starting Wednesday, the company will include a surcharge on memory modules and solid-state drives (SSDs), while semiconductors remain exempt. This decision comes after a warning issued to customers during a post-earnings call in March, where Micron indicated plans to offset tariff-related costs through consumer pricing adjustments. These steps were anticipated following a separate price adjustment for increasing product demand in late March.

The tariffs, which specifically target Asian manufacturers, bring about varied implications. China's tariffs are notably high, with an effective rate of 104%, due to a combination of a 34% reciprocal tariff and additional penalties. This places Micron, whose manufacturing operations span several Asian countries including China, Taiwan, Japan, Malaysia, and Singapore, in a challenging position. These operations are integral to Micron's supply chain, but the recent policy changes necessitate strategic shifts to protect its profitability and market standing.

Asian NAND module manufacturers are similarly strategic in response, choosing not to absorb these added costs. An unnamed executive from this sector echoed sentiments that the hefty tariffs offered no room for manufacturers to absorb costs without impacting their financial health. This sentiment reflects a broader industry trend, with technology producers such as Acer also raising US-bound product prices by 10% to counter the tariffs.

Micron's response illustrates the company's adaptability and resilience in the face of escalating economic pressures. Its investments in Asian facilities underscore a long-term strategy aimed at securing manufacturing resilience and meeting global demands. For example, Micron has invested substantially in Malaysia to support AI infrastructure, and is further expanding capacity with new facilities such as a chip packaging plant in India.

The wider context includes other companies reacting similarly, such as Razer, which recently pulled Blade laptops from US markets citing tariff concerns. As these economic and political dynamics unfold, they underscore the complex interdependencies of global manufacturing sectors and their capacity to withstand geopolitical shifts.

Sources: Reuters, TechSpot, Skye Jacobs

Manufacturing