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Fresh PCB Concepts: Tariffs and the Importance of a Diverse Supply Chain

With the new Trump administration, we anticipate an increase in tariffs on products from China, including printed circuit boards (PCBs). The current U.S. tariffs on PCBs from China is 25%, with two-layer and four-layer boards excluded from the tariffs until May 31, 2025.

I’ve recently received a lot of questions about tariffs, even from the engineering end. While we are uncertain what the future will hold, this situation illustrates why it’s important to have a diverse supply chain.

President Donald Trump has said multiple times he will increase tariffs on goods from China from anywhere between 25% to 60%. The potential domestic and international economic impact of these tariffs could lead to increased inflation and trade wars, as well as major disruptions in the global supply chain.  

While China accounts for approximately 50 percent of the global market in PCB production, there are other options in the market, including some that are cost-competitive and reliable when factoring in increased tariffs. It’s important to note this still ensures high reliability. The market has capitalized on these uncertainties and has taken advantage of the geopolitical issues.

One of my colleagues, together with a customer, recently traveled to Thailand to audit a few factories that are cost-competitive with factories in China. They passed our stringent 12-month sourcing process. The customer was impressed with the facility, equipment, and staff and will be moving forward to move parts to one of these facilities to avoid disruptions.

Pending tariff developments, I’ve put together a timeline detailing how tariffs have affected PCBs: 

Timeline of U.S. Trade Representative Tariffs on PCBs from China

July 6, 2018: Initial Section 301 Tariffs Implemented (List 1)

• Rate: 25%
• Scope: $34 billion worth of Chinese goods, mostly industrial equipment and machinery
• PCBs: Not included

Aug. 23, 2018: Section 301 Tariffs Expanded (List 2)

• Rate: 25%
• Scope: $16 billion worth of goods, including more electronic components
• PCBs: Not included

Sept. 24, 2018: Section 301 Tariffs on $200 Billion (List 3)

• Rate: 10% initially (increased to 25% in 2019 per below)
• Scope: Consumer goods and industrial products, including PCBs

February 2019: Tariff Exclusions Announced

Exclusion for PCBs:

• Two-layer PCBs: Statistical reporting number 8534.00.0040
• Four-layer PCBs: Statistical reporting number 8534.00.0020
• Expiration: Initially valid for one year (later extended)

May 10, 2019:  Increase of List 3 Tariffs

• Rate: Increased from 10% to 25%
• Scope: Continued to include PCBs

February 2020: COVID-19 Temporary Exclusions

• Details: USTR allowed some temporary exclusions on medical and essential goods but did not change PCB tariffs directly
• August 2020: Renewed Exclusion for 2- and 4-Layer PCBs
• Expiration: Extended through Dec. 31, 2020

Jan. 1, 2021 to March 22, 2022: No Exclusion for Two- and Four-layer PCBs

March 23, 2022: Reinstated Exclusion for Two- and Four-Layer PCBs

• Expiration: Initially valid through Dec. 31, 2022

Extensions for Two- and Four-layer PCBS

• Dec. 16, 2022: Renewed exclusion extended through Sept. 30, 2023
• Feb. 2, 2023: Renewed exclusion extended through Sept. 30, 2023
• Sept. 9, 2023: Renwed exclusion extended through Dec. 31, 2023
• Dec. 26, 2023: Renewed exclusion extended through May 31, 2024
• May 24, 2024: Renewed exclusion extended through May 31, 2025

Jeffery Beauchamp is a field application engineer at NCAB Group.