This hardware manufacturer says it can beat 200% tariffs, but do the numbers check out?

It’s a bold claim, especially as the likes of Apple and TSMC have raced to expand operations in the US in the wake of Trump’s tariffs.

But Sebastian Sassi, VP of sales at Atlantic Vision, FTTH and data centre fibre optics cables and terminals firm Atlantic Vision, told Capacity that since Trump’s tariffs are applied to the cost of goods, not the selling price, their low production costs in Shanghai allow them to remain competitive.

According to Sassi, the way tariffs are structured means they don’t hit as hard as some might assume.

“If I make a widget and it costs me 13 cents to produce in Shanghai, but I sell it for $100 in the US, the tariff is applied to the 13 cents — not the final selling price,” he explained. “So even at 200%, I’m paying a tariff on a tiny fraction of my total cost structure.”

By contrast, US-based competitors like Corning and CommScope, in Sassi’s view, manufacture at far higher costs — and since countries like Mexico or Canada, where production is theoretically cheaper than in the US, are also hit by tariffs, he argues that tariffs ultimately push domestic competitors to raise prices, rather than protect the market.

“The whole point of a tariff is to allow domestic manufacturers to charge more. So, if I have to increase my prices a little bit, they’ll increase theirs by even more. I can still compete just fine.”

“MPO quality, capacity, and cost can’t be replicated in this country, so high volume orders can only come in from China,” Sassi added. “Major manufacturers still import the raw materials, so tariffs don’t change the equation on cost savings.”

In Sassi’s view, price, not politics, is king for data centre operators.

Providers have access to a $42.45 billion war chest through the Broadband Equity, Access, and Deployment (BEAD) program to built out connectivity across the US.

While BEAD grants require domestically sourced fibre products, Sassi says a large share of customers are private investors or enterprises that aren’t bound by Buy America requirements.

“The data centre market sees our product as a commodity. If I sell an MPO trunk cable for $3,000, and one of my domestic competitors sells the same thing for $29,000, why would an operator pay 10 times more?” he said. “The American-made version isn’t 10 times better. Frankly, it’s not even as good.”

The sales VP also dismissed the idea that the US can fully decouple from China when it comes to fibre optics. “There’s no such thing as an optical network that doesn’t have Chinese components. Anyone who tells you otherwise is lying.”

While Sassi insists that tariffs won’t upend his business model, the broader reality of data centre and fibre infrastructure expansion tells a more complex story.

The race to scale AI-ready data centres is colliding with supply chain constraints, rising component costs, and geopolitical uncertainty, factors that tariffs are set to amplify.

As AI workloads surge, data centres are scrambling to upgrade their cooling infrastructure, particularly with high-density liquid cooling systems. Angela Taylor, Chief of Staff at LiquidStack, points to significant challenges ahead.

“The immediate hurdles are rising component costs and a strained supply chain,” Taylor said. “With many manufacturers dependent on global sourcing, tariffs could lead to longer lead times and increased expenses.

“US-based production could become a game-changer, enabling data centres to adopt liquid cooling technologies more efficiently and mitigate these challenges.”

There’s also an impact on access to high-end chips. Take Nvidia’s highly anticipated Blackwell GPUs, which are being manufactured by TSMC in Taiwan. With the likes of Meta, Google, and Microsoft each snapping up thousands of chips, only for the shipments to be hit by tariffs, data centre operators are set to feel the brunt.

There are attempts by manufacturers to alleviate the issue, but setting up new plants in the US would take years to come online at a time when operators need access to AI chips now. With AI training and inference workloads requiring increasingly powerful hardware, any disruption to the supply chain risks slowing the pace of expansion.

Tariffs may not single-handedly drive up data centre and fibre expansion costs, but they add pressure to an already strained supply chain.

Component shortages, price hikes, and increased scrutiny of foreign suppliers mean that operators are facing tough decisions. Do they absorb higher costs to comply with domestic sourcing mandates, or do they accept longer lead times and supply chain risks to keep expenses down?

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