tl;dr Prices won't be going down, only up
It's been awhile since I wrote about the tariff issue. It's time for an update.
TACO (Trump Announces, Chickens Out) doesn't actually describe the tariff situation, as some in the media seem to think. It's more like TICK, TICK, TICK (Trump Incites, Changes Kick). It's a classic bullying tactic being applied to key financial relationships between countries.
Take Japan, for instance. The established tariffs on photo goods—which the US doesn't make and isn't likely to make—was in the single digits, as low as 2% on many items. Trump announced a 35% tariff to be applied starting in August, then negotiated a 15% tariff. Incite, then change the kick (back away in this case).
However, 15% is still a double digit increase and much higher than the previously existing tariffs, And this pattern is replicating across multiple countries where "agreements have been announced." (I put that last bit in quotes because an agreement is a finished document, and we haven't exactly been seeing those.) Vietnam was going to be 40%, now will be 20%. China was 145%, now is temporarily 30%. Thailand is currently at 20%, though Trump's August 1st deadline originally promised a 35% tariff.
All four countries I just mentioned produce significant amounts of the cameras and lenses we buy here in the US. Products from all four will be more expensive soon, if not already.
Here's the thing that doesn't get mentioned in most tariff discussions: the effect of tariffs is time-lagged. Fujifilm raised their prices on August 1st, but that's not a reaction to the August 1st tariff changes, it's trying to catch up with the initial tariff increases, particularly on China. Likewise, Nikon raised prices on China-produced products, and is about to raise prices (September 1st, I hear) on their non-China built products, but those new prices are triggered by the initial tariff increases, not the new ones, such as the 20% tariff on Thailand products
You can see the slow-roll issue in the financial statements of foreign companies (and even US ones). Pretty much everyone didn't change their pricing in Q2 of 2025, but you see their financial statements say that they took a hit from the tariffs by not doing so. Most have been making price changes in Q3 2025—which is where we currently are—with some of those are still in progress and which won't really change until September price lists to dealers go in effect. By the time we reach the fourth quarter of 2025—the holiday buying season—higher prices will be the norm, though it remains to be seen how holiday sales and promotions might impact final pricing. No matter what, those sales will be starting from a higher price point, so it's still effectively a price increase..
This is similar to the supply chain problem that the COVID pandemic caused. Initially, everyone had inventory of both finished items in stores as well as some just-in-time production inventory. As the just-in-time capability dried up, so did production. Eventually that led to product shortages. Impacts like tariffs and supply chain shortages take time to progress through the system before becoming obvious, often six months or more to trickle through to maximum impact.
We're probably only halfway through the tariff-induced price changes here in the US, and that's assuming that there are no new changes after the September ones take effect. Trump keeps finding new "invisible demons" to tax as he tries to make other countries do what he wants them to (prediction: they won't, particularly long-term).
The problem I see brewing is this: if the camera companies have to make another round of tariff adjustments here in the US, the holiday market, when the most photographic gear is sold, gets completely messed up. I'm starting to think that the holiday discounts this year won't even match previous list prices. That's going to create rougher times for camera dealers, even big ones.
The takeaway here is simple: tariff impacts have a delayed impact. The full force of a tariff isn't known until all existing inventory in the chain is cleared and all items moving through the economy are being taxed. at the new rates And even then, given the whimsical nature of the TTT (Today's Trump Tariff), we still might be seeing price changes far into the future.
Overall, for all hard good products in the US, tariffs averaged about 2.5% in 2024. Here in 2025 they're currently averaging 17% (source: Jefferies). That's a significant change.
Which brings us to "who pays the tariff?" Trump has insisted that Americans won't pay it. While I've seen some evidence that some of the producers lowered their price some at the port, the bulk of the evidence says that most of the tariffs are being paid at the port by the importer. (There's also a temporary impounded import where the item sits in the US and doesn't get tariffed until it is removed from the temporary US warehouse; some of the camera companies have used this in anticipation of the initial tariff being lowered at some point, which is what has happened for Japanese imports.) So the tariffs are mostly being paid by the importing company (typically the camera company subsidiary). Whether they pass them directly on to customers is the question.
To date, that was a half-and-half solution, as described above. The camera companies are afraid of losing customers, so they've moderated their pricing changes to be rolled out over time. The Nikon Z5, for example, was on sale at US$1000, and now is available at US$1100, a 10% increase. But the list price is still the same US$1400 (and going to go up I believe US$50 on September 1st).
While that 10% increase at first looks the same as the originally thought 10% Thailand tariff (now 20% under TTT), another factor comes into play: the tariff is on the distribution price, not list price. With cameras, that price can be half of sale price, so NikonUSA could be paying 10% on US$550 (US$55) but you're paying 10% on US$1000 (US$100). Thing is, the actual tariffs have bounced around so much, so fast, I'd not want to be the one trying to keep track of everything. Nikon clearly raised the prices of everything that's coming in from China last month, but there's no indication that the China deal is a "final deal" (if there is any such thing in the Trump world; he has a reputation for trying to negotiate after a contract is signed or a job finished).
Mainstream media has been wondering why we haven't seen inflation budge much with all these new costs. Don't worry, it will. Soon. It didn't budge in Q2 2025 when the tariffs started because they were initially absorbed as losses at most companies. But with most making price adjustments in Q3 2025, these will now show up in later inflation figures.
If you look at the port import volumes, there was a significant uptick in late 2024 and early 2025, which would seem to indicate inventory buildups, particularly of goods from China. This was followed by a huge dip in shipping when the original tariff amounts were announced, but bounced back temporarily to historically high levels again when the first TICK happened. That said, the current forward projection for the Los Angeles port—which is where most of our photo gear comes through—is for a double-digit drop starting in August through the holiday season (source: National Retail Federation).
Putting on my economist's hat—my PhD work was in New Technology Economics and Management—pretty much all the models I have available for forecasting say the same thing: prices on anything imported are going to go up and likely stay up. How much is the question no one can answer for sure. Macroeconomic theory says something has to give, but so many variables are involved it's easy to get a detail wrong in a prediction. For example, three distinct possibilities for cameras/lenses exist: (1) volume goes down due to higher prices; (2) volume stays relatively the same for cameras but other products bought with disposable income have to go down (e.g. fewer lenses and accessories bought); or (3) camera companies lower prices (in other words, absorb more of the tariff) in order to keep volume intact. But note in #3, that's lowering prices from a higher price point (post tariff) to start with.
Going back to that Z5: will it hit US$1000 again during the holidays? Maybe (assuming no new tariff changes come along). That would require Nikon to discount it US$450, which is on the high side of what they've done before. I believe NikonUSA was ready to price it at US$900 for Christmas 2025 as it was, given that it's an older camera that has paid back its R&D costs manyfold. Still, the tariffs now make it difficult for the <US$1000 full frame camera to exist.
The bigger problem is that what I wrote about above is happening (slowly) across all imported products in the US, from food to parts for making US autos and homes. The cumulative impact of the implied inflation from that is what economists are worried about. And given the size of the US economy, if it starts to tank (e.g. recession), that will impact the rest of the world, as well. As I've written before, this is a play we've seen before, and it doesn't have an uplifting ending. Well, prices get uplifted, but that's not what I meant ;~).
