Barbie maker Mattel warns Trump tariffs may drive up prices
2025-02-05
Category: economic

Toy making giant Mattel says it may increase its prices in the US to make up for the impact of Donald Trump's tariffs.It comes after the US president imposed 10% tariffs on all imports from China, where just under 40% of the firm's production is based.On top of potential price increases, the maker of Barbie and Hot Wheels says it could have to implement changes to its supply chain. Consumer and business groups in the US have warned that the tariffs may disrupt supply chains and lead to higher prices.
"Guidance includes the anticipated impact of new US tariffs... announced on February 1st, and mitigating actions we plan to take, including leveraging the strength of our supply chain, and potential pricing," Mattel said in its quarterly report.The toy industry has been facing slower sales in 2024, as a higher cost of living meant shoppers had less cash to spend on toys. Despite this, Mattel's shares jumped by 10% in extended trading in New York, after the company forecast better profits for next year than had been expected by Wall Street analysts.Trade expert Deborah Elms notes that this 10% tax is on top of tariffs that were already in place."For many products, this now means tariffs are 35% or even higher. That can be difficult for any firm to continue to absorb, without raising prices for the final consumers," she added.Over the weekend, the head of International at the US Chamber of Commerce, John Murphy, said Trump's tariff plan will only "raise prices for American families and upend supply chains".This week, Trump paused plans to impose a 25% tariff on imports from Canada and Mexico but went ahead with an additional 10% levy on Chinese-made goods.