2025 Tariffs on Electronics from China: Design and Source Smarter

NOTE: This article was updated on July 3, 2025 to reflect recent information regarding tariffs.

The tariff tables have turned — again. If your designs depend on Chinese components, your cost projections may already be out of date.

Tariffs on electronics from China are once again reshaping the landscape for U.S. manufacturers. In 2025, the Trump administration revived aggressive trade tactics — including steep import duties aimed at reducing reliance on Chinese supply chains.

For supply chain managers and procurement professionals, the pressure is on. These tariffs are already impacting your daily operations, dictating design choices, and forcing strategic sourcing shifts. Your ability to understand and navigate these implications is now central to maintaining continuity, competitiveness, and product compliance.

The tariffs may sting, but they could be the push your team needs to build a stronger, more resilient supply chain. Below, we’ll explore the current landscape, identify the most affected electronics categories, and offer strategic insights to safeguard your supply chain and margins.

What’s Happening With Electronics Tariffs Right Now?

As of June 2025, the U.S. government has sweeping tariffs on a wide range of Chinese imports, including a broad spectrum of electronics. Tariff rates on these products now commonly fall between 10% and 40%, depending on classification, and are part of a broader campaign to stimulate domestic manufacturing, reinforce trade leverage, and respond to long-standing intellectual property concerns.

While a temporary 90-day truce announced on May 12, 2025, reduced tariffs on certain goods, key electronic products and components remain squarely in the crosshairs. The agreement expires in August, and there’s strong potential for another escalation.

At the same time, importers face increased customs scrutiny, more frequent documentation checks, and abrupt classification shifts, all of which complicate planning and execution.

Because of this, companies are experiencing:

• Elevated inspection rates at ports
• Delays tied to revised Harmonized Tariff Schedule (HTS) code enforcement
• Unpredictable fees that hit post-clearance

These conditions have made long-term forecasting increasingly difficult and forced many firms to rethink how they import electronics from China to the U.S.

Affected Product Categories

The list of tariffed goods is extensive, but some categories stand out for their outsized impact on electronics manufacturing:

Printed Circuit Boards (PCBs)

Tariffs on rigid and flex PCBs sourced from China typically range from 25% to 30%. This means higher costs for prototyping and production alike, complicating budgeting during early-stage design and putting pressure on already tight development cycles.

Electronic Components

Passive components like resistors, capacitors, and inductors — as well as active components such as voltage regulators and logic devices — are all impacted. This creates a volatile pricing environment that makes locking in BOM costs during the design phase more difficult. Semiconductors, for example, have seen tariffs increase to 50% in 2025.

Subassemblies and Finished Goods

Complex items like HMIs (human-machine interfaces), power supplies, displays, and control boards are particularly vulnerable to tariffs because of their hybrid construction. These assemblies often combine electrical and mechanical components, which can trigger multiple tariffs based on how each part is classified, leading to higher costs and disputes over import duties.

The Bottom-Line Impact for OEMs

In 2025, tariffs are proving to be a profound destabilizing force, deeply affecting engineering, procurement, and production operations.

Key impacts include:

• Unit cost increases of 15% or more on affected items
• Surprise customs fees that appear after delivery due to retroactive audits or classification shifts
• Longer lead times from enhanced inspection protocols and customs delays
• Supply chain disruptions if a vendor can’t pivot to alternative, tariff-compliant sourcing in time

These conditions demand a deeper awareness of material selection, stack-up design, and component footprints. Cost now goes hand-in-hand with country-of-origin risk, and managing that equation requires tighter coordination between engineering, sourcing, and compliance teams.

Mitigation Strategies: Protecting Your Bottom Line and Supply Chain

Tariffs on electronics from China can feel like a moving target. While policy may shift, the best defense remains a proactive, layered strategy. Below are high-impact methods to reduce both financial risk and operational disruption.

1. Diversify Suppliers by Geography

Overdependence on Chinese manufacturing exposes your supply chain to both tariff volatility and geopolitical risk. A growing number of electronics firms are adopting “China+1” sourcing models, where they supplement Chinese production with suppliers in countries like:

• Vietnam
• India
• Mexico
• Taiwan

Though these regions may not yet match the scale of Chinese electronics companies, they are increasingly competitive in price and quality for key product types. Companies should use origin tracing and sourcing audits to verify where each component and subcomponent is produced, especially when classifying electronic goods from China.

2. Take Advantage of FTZs and Bonded Warehouses

Foreign-Trade Zones (FTZs) and bonded warehouses are essential tools in tariff timing and cash flow optimization. Benefits include the ability to:

• Defer duties until goods are officially sold or removed
• Re-export products without paying U.S. import duties
• Modify or repackage goods before official import, enabling tariff reclassification

This approach is particularly valuable when importing electronics to the USA for seasonal or uncertain demand forecasts.

3. Smart Tariff Engineering

Through tariff engineering, you can make legal, strategic modifications that reduce your product’s dutiable value:

• Remove or reconfigure pre-installed components
• Repackage assemblies to meet alternate Harmonized Tariff Schedule (HTS) classifications
• Split kits into separate shipments if allowed

Always consult customs experts to ensure compliance. Small changes in structure or packaging can convert a 25% tariff into a 5% duty, or none at all.

4. HTS Code Optimization and Auditing

The HTS code you apply directly determines duty rates. But misclassifications are common — and costly.

Don’t stress – there are steps you can take:

• Audit your codes annually or whenever product designs change
• Use trade software or AI-driven tools for real-time classification alerts
• Regularly check updates from the Office of the U.S. Trade Representative (USTR) for tariffs on Chinese electronics and potential exemptions
• Validate Certificates of Origin to ensure tariff qualification is accurate

Proper HTS reclassification can lead to significant savings or refund claims if there’s an error. For example, reclassifying a power module as a subcomponent instead of a finished control unit could lower the duty rate from 25% to 8%.

5. Re-Engineer for Flexibility

Build engineering and sourcing strategies that can adapt to tariff changes:

• Include multisourcing pathways in lifecycle planning
• Use interchangeable parts or modular components that allow for low-tariff substitutions
• Incorporate socketed ICs or firmware-controlled elements for feature flexibility
• Design tolerance ranges into passives like capacitors and resistors

These practices minimize time-to-market delays from sudden tariff hikes or unexpected component shortages.

6. U.S.-Based Assembly or Nearshoring

In some cases, importing bare PCBs or semi-finished subassemblies and completing assembly or testing in the U.S. or Mexico can significantly reduce the import duty on electronics from China.

While domestic labor may cost more, the duty savings and reduced customs risk can make this approach financially viable, particularly in sensitive product categories, like PCBs, power management systems, and medical device subassemblies. 

7. EMS Partnerships Built for Tariff Resilience

Collaborate with electronics manufacturing services (EMS) partners that:

• Already maintain compliant, tariff-resilient supply chains
• Offer component life cycle planning and end-of-life alerts
• Can shift production between regions based on current trade conditions
• Provide both global and domestic fulfillment

Top-tier EMS partners often qualify for tariff exemptions and can reroute production quickly to reduce your exposure to extra taxes.

8. Broaden Risk Mitigation Beyond Tariffs

Tariffs are just one part of the risk landscape. To fully protect your supply chain:

• Invest in demand forecasting to avoid overstocking tariffed components
• Gather and verify Certificates of Origin for all suppliers
• Shorten logistics chains where possible to avoid transit disruptions
• Embed life cycle planning into design to prevent unexpected part shortages

These practices help build long-term stability, even as policy changes continue unfolding.

Looking Ahead: Future Tariff Developments

The Trump administration has made it clear that tariffs are not a short-term tactic, but part of a long-term strategy to boost domestic manufacturing. While this may benefit U.S.-based EMS providers over time, short-term volatility is likely to persist.

Expected developments include:

• Expansion of tariffs to cover battery modules and energy storage systems
• Stricter rules on transshipment through third-party countries
• New funding provisions for domestic PCB and semiconductor manufacturing under an updated CHIPS Act 

For electronics professionals, these changes emphasize the need for proactive sourcing, modular design, and flexible supplier networks. The ground is shifting, and those who can move with it will avoid the aftershocks.

Building Resilience Into Engineering Design

The current tariff environment reinforces a key principle: Both sourcing and engineering decisions impact business outcomes.

Designing with trade constraints in mind can help you:

• Avoid last-minute component changes and shorten development cycles
• Reduce total landed costs by steering clear of tariff-heavy imports
• Lower compliance risks related to origin misclassification or HTS disputes
• Diversify supply and reduce reliance on single-source vendors

The takeaway? Treat tariff exposure like any engineering constraint. It can be mitigated — just like thermal limits, power budgets, or regulatory certifications — with planning, tools, and foresight.

Trade-Proof Your Electronics Supply Chain

Tariffs on electronics from China directly threaten your profit margins, production timelines, and competitive edge. Every component decision you make today has downstream consequences, especially in an environment where trade rules can change overnight.

The good news? You hold the keys to transforming this challenge into an opportunity. By planning well ahead, distributing risk intelligently, and fostering supplier agility, you can ensure your business thrives, regardless of future tariff levels.

A Lifeline for Inventory Management

If you’re already grappling with tariffs, chances are you're also battling unpredictable lead times, aging components, and shrinking vendor lists. That’s where aftermarket support becomes a lifeline.

Partnering with an electronics manufacturer that offers full life cycle services — from repair and component tracking to inventory planning and obsolescence management — puts you in control of your supply chain. It turns reactive scrambling into proactive stability.

Let’s talk about how aftermarket support can protect your supply chain — and your bottom line: