- President-elect Donald Trump proposed broad tariffs on imports, including up to 60% on goods from China.
- Economists say his proposals could spike inflation as companies tend to pass costs on to shoppers.
- Some companies have already said increased tariffs would lead them to raise prices.
Some executives have warned that price hikes are on the way if President-elect Donald Trump’s trade plans go into effect.
On the campaign trail, Trump proposed a 60% tariff on goods imported from China coupled with a 10% to 20% tariff on goods imported from other countries. While the president-elect could choose not to enact tariffs at that scale once he assumes office, economists and the market have predicted that his proposals would spike inflation and cause the Federal Reserve to raise interest rates.
Several companies have already begun responding to Trump’s election victory and the implications his tariff proposals would have on the costs of their goods. Executives have told analysts on earnings calls that it would be difficult to maintain current prices under Trump’s broad tariffs.
Other companies are still waiting for more information from the president-elect. Tarang Amin, the CEO of ELF Beauty, told Business Insider that the company must first see the policy Trump enacts before making any changes to its pricing and that a new policy wouldn’t affect the business until after its 2025 fiscal year.
“We don’t like tariffs because they are a tax on the American people,” Amin said, adding that the company had been subject to a 25% tariff since 2019 because of policies from Trump’s first term. “And at that time,” he said, “we pulled all the levers available to us to minimize the effects to our company and our community.”
Karoline Leavitt, a Trump-Vance transition spokeswoman, told BI: “In his first term, President Trump instituted tariffs against China that created jobs, spurred investment, and resulted in no inflation.” She added that Trump will “work quickly” to lower taxes and create more American jobs.
Below are the companies that are warning of price increases if Trump’s tariff proposals are implemented.
AutoZone
Philip Daniele, the CEO of the auto-parts company AutoZone, told analysts on a September earnings call that tariff policies had “ebbed and flowed over the years,” and if Trump implemented more tariffs, “we will pass those tariff costs back to the consumer.”
“We generally raise prices ahead of that,” Daniele said, adding that prices would gradually settle over time. “So, that’s historically what we’ve done,” he said.
Columbia Sportswear
Tim Boyle, the CEO of Columbia Sportswear, told analysts on an October earnings call that the company was “very concerned about the imposition of tariffs. ” He said that while he considered Columbia adept at managing tariffs, “trade wars are not good and not easy to win.”
Boyle also told The Washington Post in October that the company was “set to raise prices.”
“It’s going to be very, very difficult to keep products affordable for Americans,” he said.
Stanley Black & Decker
Donald Allan, the CEO of the manufacturing company Stanley Black & Decker, told analysts in an October earnings call that the company had been evaluating “a variety of different scenarios” to plan for new tariffs under Trump.
“And obviously, coming out of the gate, there would be price increases associated with tariffs that we put into the market,” Allan said, adding that “there’s usually some type of delay given the processes that our customers have around implementing price.”
Allan also said the company would consider moving its production out of China and to other countries, such as Mexico, to reduce the impact of a 60% tariff on Chinese imported goods. Steve Madden was among other companies that announced plans to import fewer goods from China, with its CEO, Edward Rosenfeld, saying on an earnings call that the company had already started that process.
Walmart
Walmart CFO John David Rainey told CNBC on November 19 that the company will likely raise prices if Trump’s tariff proposals are implemented.
“We never want to raise prices,” he said. “Our model is everyday low prices. But there probably will be cases where prices will go up for consumers.”
Rainey added that the company is “pretty familiar” with tariffs, given Biden and Trump’s policies over the last seven years, but he said they’re “inflationary for customers, so we want to work with suppliers and with our own private brand assortment to try to bring down prices.”
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