For consumers, prices of “everyday tools,” like smartphones, laptops, tablets, smartwatches, connected devices, and vehicles, could increase at a time when US households are already budget-strained. Tariffs could also limit technology choices for Americans by delaying new product launches, including devices featuring the latest AI technologies. And any dampened demand for popular tech risks further limiting innovation while seemingly working in lockstep with tariffs to slow AI adoption in the US, the letter warned.

“Consumer devices are the primary interface through which Americans access AI-powered tools. AI only delivers on its promise when people can actually use it—and tariffs that price consumers out of the device market would slow AI adoption at the very moment the United States is positioned to lead,” the letter said.

To shield AI firms, the Trump administration is mulling some tariff relief, but sources told Politico it would likely be tied to foreign firms investing in US chip manufacturing, like Taiwan Semiconductor Manufacturing Co. Apparently, that’s the approach Commerce Secretary Howard Lutnick favors most.

Perhaps mindful of the data center development timeline—and possibly the upcoming holiday season, as Trump previously has exempted goods from tariffs to avoid consumer backlash that negatively impacted his approval ratings—the administration may impose tariffs in phases to avoid the worst impacts hitting all at once.

Industry talks with Trump turn “negative”

The global data center buildout already has the tech industry broadly scrambling for access to high-end semiconductors, which are forecasted to remain in short supply well into 2027. Just yesterday, Gartner forecasted that due to the shortage that’s driving price increases, global semiconductor revenue is expected to reach $1.6 trillion in 2026—much sooner than expected.

Economists expect that tariffs would only further increase prices for chips, which Politico reported could “hammer US chip designers such as Nvidia and Advanced Micro Devices, which rely on overseas manufacturers to produce their chips.” Tariffs could also hurt companies like Apple, which competes with foreign rivals overseas that wouldn’t have to deal with the tariffs. Chinese firms could benefit, Politico suggested, as chip suppliers potentially avoid tariffs by increasing business in China.