Tariffs push global brands to raise prices amid challenges
The world's largest consumer and retail brands are discussing how American tariffs impact their operations during their financial conferences. Some companies are already noticing increased import costs, particularly from China, where the U.S. has imposed a 145% tariff.
For some companies, tariffs present a clear but challenging problem: goods produced abroad, especially in China, have become more expensive to bring to the U.S. To protect profit margins, brands and retailers will be forced to raise prices.
American tariffs: global brands react
Business Insider reports that Germany-based Adidas has warned that the prices of almost all its products in the U.S. will increase due to the current tariffs. The company's CEO, Bjørn Gulden, stated that "we currently can't produce almost any of our products in the U.S." If tariffs remain in place, there will inevitably be higher prices for footwear in that market.
Amazon, on the other hand, has emphasized keeping platform prices low despite existing tariffs on imports from China. CEO Andy Jassy highlighted that Amazon's wide selection of products is an advantage for consumers. Some retailers have resorted to stocking up, but this is a short-term solution, especially as supply chain complications arise. When the idea of adding the cost of imposed tariffs to the product price on Amazon was proposed, the White House immediately reacted. White House Press Secretary Karoline Leavitt called the proposal a "hostile and political act," leading the company to withdraw the idea.
Coca-Cola CEO James Quincey stated during a conference call about the company's financial results that the impact of tariffs on their operations is "manageable." Coca-Cola benefits from sourcing many ingredients from local producers, minimizing the need for imported items like production machinery.
However, tariffs and the broader backlash against the U.S. still negatively affect the company. Coca-Cola has noted a decrease in sales among Hispanic consumers in the U.S. and parts of Mexico. In response, Coca-Cola has begun emphasizing the local manufacturing of its drinks in Mexico through the ad campaign "Hecho en México" (produced in Mexico).
