New tariffs President Donald Trump imposed could directly affect War Horse Casino's expansion plans, said CEO Lance Morgan. In an open Facebook post, Morgan described the financial strain these tariffs place on the casino's operating goals, pointing to $3 million in extra expense over two days due to the tariffs.
Key takeaways
● War Horse Casino CEO expressed concern tariffs will lead to a volatile market affecting the casino industry.
● Trump introduced his tariff policy on Apr. 2, which he called a ‘Liberation Day.’
● Many slot machine components and casino equipment come from outside the U.S. – mainly Asia – where Trump placed a 54% tariff on Chinese goods.
Central to the issue are the tariffs charged on gaming machines, namely slot machines, that are vital to the casino's daily activities and future expansion. The slots, which cost around $30,000 per machine, saw substantial price increases due to import levies on goods from leading manufacturing countries such as China and Japan.
The War Horse brand, owned by Ho-Chunk, Inc., economic development entity of the Winnebago Tribe of Nebraska and a major proponent of Nebraska’s online sports betting bill, has been a key factor in the state's burgeoning casino sector since Nebraska voters approved casino-style gaming in 2020.
The expansion projects affected are a new building proposed for South Sioux City and expansion of existing operations in Omaha and Lincoln. The casino already planned these projects with different cost assumptions, and the sudden rise in equipment costs is now causing War Horse Casino to rethink timelines and investment strategies.
Morgan explained the unpredictability of such trade policies undermines the stable economic environment businesses need to make long-term investments. The CEO warned budgeting will be more complicated and risky without predictable input prices.
He feared the tariffs would create an instantaneous financial hurdle and a structural disruption that would impede future growth and regional development.
Tariff plan affects most consumer industries
The tariffs are part of a broader trade war strategy aimed primarily at reducing America's trade deficit and pressure countries such as China to alter what the administration called unfair trade practices.
Imported items the administration’s tariff policy affect include electronics, factory equipment, and equipment parts—a class that covers gaming devices such as slot machines. Slot machines, due to their increasing electronic complexity, often need imported parts.
Chinese and Japanese-based companies dominate the global gaming hardware market, and the tariffs resulted in dislocated supply chains and higher costs.
Morgan also identified what he sees as opportunistic behavior on the part of some industry vendors. According to him, most suppliers have already priced in advance, anticipating higher costs from tariffs before those higher costs materialized, even though they haven't yet had to pay them.
These vendor practices and tariffs contribute to what Morgan described as a volatile and exploitative market environment. The mix of short-term financial pressure and price uncertainty could delay construction schedules, increase financing costs, and reduce the size or scope of new projects.
Since introducing the tariffs, major U.S. casino corporations saw stock prices drop, including Wynn Resorts, which fell 11%, PENN Entertainment, which declined 10%, and Caesars Entertainment, down roughly 9.5%.
