Is It True? How Tariffs Might Force Canon to Cut Costs.

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Is It True? How Tariffs Might Force Canon to Cut Costs.
Tariffs and Canon’s Financial Challenges.
In a past conversation, it was noted that Canon’s management had stated that the Trump-era tariffs wouldn’t have much of an impact on the company in the U.S. However, with a new round of 20% tariffs on products from the EU, the situation might be different. The question now is whether Canon USA will absorb the increased costs for its ProStream and IX series printers, or will they raise prices, risking a hit to their competitive edge. Competing with well-established players like HP and Kodak—who dominate the high-speed roll-fed printer market, with much of their equipment manufactured in the U.S.—is no easy task.

Moreover, Canon is facing additional pressure from tariffs on key consumables like ink and precoating materials, as well as the costs tied to head replacements. The company is already engaged in a pricing war with HP over ink costs, and a 20% tariff hike could seriously erode Canon’s profit margins. If those costs are passed on to customers, they may be pushed to consider switching to other manufacturers, further impacting Canon’s market share.

The situation is compounded by ongoing complaints from Canon customers about the cost of head replacements and the company’s reluctance to change them due to internal cost considerations. These issues, combined with the added tariff burden, could hurt Canon’s customer satisfaction and loyalty.

Additionally, it’s no secret that Kodak’s leadership, particularly its CEO, has close ties to former President Trump, which may be influencing the company’s efforts to ensure the tariffs remain in place. If these tariffs persist, Canon may be forced into another round of cost-cutting measures, further straining its operations and ability to stay competitive.

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April 10, 2025 at 3:50 PM