I asked ChatGPT how Trump’s new tariffs impacted the construction of new AI data centers. It estimated that the tariffs would increase the cost by 15 to 20 percent. Here is what it said:
Many types of data center equipment and materials—ranging from core infrastructures like steel and electrical hardware to IT servers and networking gear—are now facing U.S. import tariffs. Here’s a breakdown:in
Which data center components are subject to tariffs?
1.
Construction and power infrastructure
- Steel, aluminum, and copper used in building frames, racks, transformers, and power systems are subject to broad Section 232 tariffs (about 25%, rising to 50% in some cases) .
- Electrical equipment, like switchgear and generators, often contain imported subcomponents (e.g. circuit breakers, relays) from Asia subject to high duties (on average 10–50%) .
2.
Cooling systems and UPS units
- Many cooling hardware systems include imported components or assemblies, especially from countries like China, Vietnam, Taiwan—tariff rates range from ~25% to ~46% or more depending on origin .
3.
Networking and optical modules
- Networking gear (switches, routers, optical modules) is heavily exposed to tariffs. For example, optical modules imported from China face rates as high as 145%, with other origins around 24–46%. The blended average import tariff for these modules is estimated at ~40% (or ~27% excluding China) .
4.
Servers, storage, GPUs, and IT hardware
- IT hardware assembled in countries like China or Taiwan—including servers, GPU systems, memory modules, and storage appliances—face baseline 10% universal tariffs, and up to 30–145% if from specific high‑tariff countries .
- GPUs and semiconductors were temporarily exempted but may soon be tariffed, either directly or when incorporated into assembled systems .
How much equipment in data centers is tariff‑exposed?
A recent analysis by Altana estimates that U.S. data center projects face $13.6 billion in annual tariff exposure, assuming existing high rates (e.g. 145% on China-origin goods). Of that total, $11.2 billion is attributable solely to Chinese imports .
In terms of overall cost impact:
- Construction material costs may rise 3–5%;
- IT hardware costs may rise around 25%, leading to a net ~16% increase in total data center build costs .
Summary Table
| Component Type | Tariff Exposure |
| Construction materials | 25–50% (steel, aluminum, copper) |
| Electrical & cooling systems | ~25–50% depending on country of origin |
| Optical & networking gear | 24–145% (weighted average ~40%) |
| Servers, storage, GPUs | 10% baseline; up to ~30–145% location-based |
Nearly all imported physical infrastructure—especially anything from China, Taiwan, Vietnam, or other non‑USMCA/APAC exempt regions—is subject to tariffs, typically 10–50% or more.
Context & Strategy
- Most data center hardware and construction supplies are imported from Asia-Pacific. Legal exclusions for semiconductors may soon lapse, potentially increasing exposure substantially .
- Some companies are mitigating impact by sourcing from tariff-exempt origins (e.g. Mexico, Canada under USMCA) or ramping up domestic assembly .
- Strategic planning and budgeting now need to factor in possible tariff volatility as legal challenges are underway and policy shifts continue .
Bottom line
A significant portion—possibly most imported equipment and materials used in data centers—is subject to U.S. tariffs. The financial exposure is substantial: billions of dollars annually, with total project cost increases of ~15–20%, depending on sourcing. That applies to power, cooling, construction, networking, storage, and compute hardware alike.
If you’d like a breakdown by specific HTS codes, country of origin, or vendor-level exposure, I can help dig into that too.