From toys to cars, tariffs hit companies' bottom lines
S E E D E D C O N T E N T
The numbers are in: Big toy and auto companies are reporting just how much tariffs are costing them.
Toymaker Hasbro said in its quarterly earnings call Wednesday that it recorded a $1 billion hit for consumer products just in the second quarter as a result of tariff impacts and its long-term outlook. Though the company is projecting growth overall in 2025 with games performing well, it's expecting consumer products revenue to drop 5%-8% this year because of the import taxes. It anticipates tariffs will make a $60 million dent this year.
To mitigate the tariff impacts, Hasbro is working to reduce the U.S. toys and games it gets from China from around 50% now to less than 40% by 2027. And it's planning to bring more production to the United States — something President Donald Trump has pushed companies to do.
Meanwhile, its competitor Mattel anticipates tariffs could make a dent this year of up to $100 million. The company said it has adjusted pricing — but didn't specify what the price increases were, which products were affected or when the changes took effect.
"It is the price that is necessary to offset some of the headwinds in addition to the array of a multitude of other actions that we're taking," Mattel Chief Financial Officer Paul Ruh said.
The company says it's working to broaden its supply chain faster and improve on its product sourcing to help mitigate tariff impacts. It doesn't expect any more price hikes this year.
And tariffs aren't just affecting toy companies — they're also hitting some of the biggest automakers in the world.
General Motors said this week tariffs cost it $1.1 billion in the second quarter. And it's expecting tariffs overall this year could cost it $4 billion to $5 billion. So far, the automaker that produces Chevys, Cadillacs and other brands has eaten that cost, and it's trying to offset some of the impact through cost cuts and investments in the U.S.
"Many of the manufacturing announcements that we made earlier in the quarter about onshoring production here into the U.S. with $4 billion of capital initiatives are going to have an effect as we get 18 to 24 months down the road," GM CFO Paul Jacobson told CNBC.
Stellantis, the maker of Jeep, Chrysler and Dodge, said it expects a $2.7 billion loss in the first half of this year, in part from tariffs.
And Volvo just reported a big decline in its second quarter operating profit. It's now planning to add its best-selling XC60 SUV to the production line of its South Carolina plant next year.
The auto industry is currently subject to 25% tariffs on imported cars and parts and 50% on steel and aluminum. It's part of an ever-changing patchwork of tariffs as the Trump administration seeks deals with trading partners around the world ahead of its Aug. 1 tariff deadline. The latest: an agreement with Japan setting tariffs at 15% on Japanese imports, less than the 25% Trump had threatened.
The American Automotive Policy Council, an industry group representing the Detroit Three automakers General Motors, Ford and Stellantis, is worried that the Japan deal could hurt companies making cars across North America. The 15% Japan tariffs are lower than the 25% on Canada and Mexico, where many American car brands manufacture their cars, trucks, vans and SUVs.
"Any deal that charges a lower tariff for Japanese imports with virtually no U.S. content than the tariff imposed on North American built vehicles with high U.S. content is a bad deal for U.S. industry and U.S. auto workers," Matt Blunt, president of the American Automotive Policy Council, said in a statement.
Commerce Secretary Howard Lutnick pushed back against complaints that U.S. automakers could face higher tariffs than companies making cars fully in Japan.
"That's just so silly," he said in a CNBC interview. "The American manufacturers are going to do extremely well in America as long as they build it in America."
Car companies haven't really upped prices yet as a result of tariffs, but that may change.
"What the challenge is going to be for the back half of the year is to figure out, will they continue absorbing a majority of the tariff impact or will we start to see that increase in consumer pricing as they start to try to pass along some of the impact," said Erin Keating, Cox Automotive executive analyst.
Cox Automotive anticipates car prices may rise 4%-8% by the end of the year. It also found that inventory of both new and used cars dropped in July.
And tariffs might mean fewer toys on the shelves this holiday season. Hasbro reports some retailers are pausing or slowing down imports of holiday inventory.
"A lot of hot products are going to likely be out of stock this holiday because we're just not going to be able to replenish them because we didn't have the upfront inventory for them," Hasbro CEO Chris Cocks said. "So like a Play-Doh Barbie, a Nano-Mals, a Baby Evie. If you're a mom or a dad, you're probably going to want to go and buy that early."
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Well... the toy companies can compensate by jettisoning any safety measures they may be implementing now. The Trump Administration is getting rid of the agency that surveilled toy safety.
Toys are dangerous? Who knew?
Nah...
If measles doesn't get them, then guns will. So who cares if their toys are deadly?
How about the ones that toddlers can swallow?
Yeah you know, meat head, the age appropriate, small parts, sharp parts, plastic bags and rubber bands; all of the stupid shit that little kids put in their mouths every day which some tiny consumer protection agency used to flag as dangerous or even recall to keep your grandchildren and their children from choking on or suffocating on.
According to this Administration they aren't worth protecting, period. Only the manufacturers need protection. /S
The ultra-rich don't need any fucking government agency. They have servants to surveille and protect their children. So they're not going to pay for that agency. It's not their kids who will die.
goddam consumer protection bullshit. there wouldn't be as many maga now without it ...
I am envisioning the comeback of lawn darts , clackers and brightly colored lead paint ......... or the return to cereal box prizes of actual radioactive toys .
Oh yeah... bring it back!! Bring it back!!
Yup
I played with both of these when I was younger, lawn darts were fun to just fling as high in the air as possible and then dodge as they came down, clackers were fun at first but quickly became annoying and boring
Can't remember anything with this or in fact anything back beyond the age of 12
I think everyone i knew that had a set of clackers also had a chipped tooth , me i was a deprived child and was not allowed a set .
i had to wait until i was 48 and bought the grand daughter one of those wooden benches with pegs and the holes and a small wooden hammer to hit the pegs in the holes . she played the baby in the tv show dinosaurs ( not the mama) and wacked me with the hammer in the mouth chipping my front teeth .
Great story! I can picture it...
We were told consumers pay tariffs. Now businesses are whining. Typical bait and switch.
How is any of this different than Joe Biden's 15% Corporate Alternative Minimum Tax that was included in the Inflation Reduction Act? A tax on business by any other name is still paid by consumers. Why are Democrat tax increases good while Republican tax increases bad?
Republicans can't be relied on to cut taxes any longer. And Trump's tariffs have been generating tax revenue to fund government; a perpetual promise made by Democrats. Tariffs fundamentally change the rules for avoiding taxes, too. Are tax loving Democrats upset because Trump has bypassed the political theater of Congressional fights to save sacred cows?
You mean the NT Tariff Experts were wrong? You don't say.
Oh you know why.
Just like the "He will damage international relations" group.
Perhaps those were the same people?
How do they find the time? between looking for those MAGA hat wearing white supremist in Chicago and Russina spys stealing our elections.
They are the same people. They are also the "Immigration Experts", "Tax Experts", "Mental Health Experts", "Military Experts", "Foreign Policy Experts"...
They are also mind readers. Somehow they know exactly what everybody is thinking.
He opined telling the 'others' what they are thinking.
The above ostrich display is amusing though.
it's funny when hypocrisy negates any self awareness.
Your sarcasm is misplaced. He didn't claim to read their minds. He is obviously referring to the progressive's practice of taking what their opponent says and "revealing" their motive for saying it, which usually boils down to some phobia, misogyny, racism or some similarly bad motive, all done in order to avoid the actual topic. No mind reading is necessary. It's right there on the page for anyone to read.
This is a very simple concept; something that you can easily understand with sources outside of this site.
The importing business pays the tariff and then typically passes it on to consumers.
If a business chooses to not pass on the tariff it will take a hit on its profit. Some businesses will do that for select products to maintain market share. Most, especially with perpetual tariffs, will not be able to do.
Bottom line, it is the consumers who are hurt by tariffs.
It is. The NT Tariff Experts were wrong.
Wrong about what, exactly?
That's a long list.
A pathetic failure to back up a ridiculous claim.
No. I'm not one of you. I'm just not playing your putt putt games.
But since you can't keep track of the lefts failures, lets start with this:
Typical ignorance and arrogance but that's to be expected from the MAGAverse where Trump can do no wrong.
The consumer IS having to pay more because of the tariffs. That is why a business like Mattel is expecting up to a $100 million loss this year directly due to the tariffs.
You do understand what "adjusted pricing" means right? You know, the cost the consumer has to pay for the goods. And when prices are adjusted up that reduces the total number of consumers willing to pay the increased price. It's a pretty simple concept that even most layman understand. Weird that a bunch of conservatives can't wrap their heads around it.
Now, there are some companies eating the cost like GM where the tariffs cost them $ 1.1 billion in just the second quarter a nd it's expecting tariffs overall this year could cost it $4 billion to $5 billion. But these businesses aren't charities, they will either have to eventually pass those costs on to the consumer or stop selling cars. While there are lots of discussions about building parts and cars here in the US, virtually every company doing so is planning on building nearly fully automated manufacturing facilities which means there are no big job benefits from this, millions of manufacturing jobs are not coming back to the US due to these tariffs. Everyone knows it would cost FAR too much to pay your average American citizen an hourly wage to turn screws on IPhone's. If an iPhone were manufactured entirely in the US, its cost could potentially triple, reaching as high as $3,500, according to some analysts. Here’s how much a made-in-America iPhone could cost | LiveNOW from FOX
So no, there was no "bait and switch" other than conservative criticism trying a new flawed angle to protect their Felon-in-Chief. Prices continue to rise under Trump with no relief in sight.
Tariffs only apply to imports. Consumers are having to pay more for IMPORTED goods. Tariffs make domestically produced goods more competitive. And businesses wanting to avoid taxes can do so by reshoring their operations.
Tariffs create incentives that are opposite those Joe Biden created with the Corporate Alternative Minimum Tax of 15%. Biden's tax made imports more competitive. And businesses wanting to avoid Biden's CAMT tax offshored their operations.
Japanese automakers also manufacture in the United States. Here are the Japanese auto plants located in the United States:
Nissan:
Japanese automakers are competing with GM by operating inside the United States. Why is that? Since they're producing automobiles in the same country for the same market, the playing field would appear to be pretty level. Look at the locations and try to figure it out.
Apple takes credit for creating and supporting 2 million jobs in the United States. Apple kind of destroys that talking point.
The real problem is that union labor cannot compete with non-union labor; even inside the United States.
Before Trump's Liberation Day, the news cycle was wall to wall opinions about how tariffs would affect the demand-side of the economy. Consumers would pay the tariffs. Inflation would soar. The economy would fall into recession as demand dried up. That was the bait.
Now the narrative has switched to how the supply-side of the economy is paying the tariffs. Stock holders are being deprived of profits. 401k funds will suffer. Businesses can't compete. (With who?)
So, yes, it's a classic economic bait and switch that we've seen many times since 1981. The tariffs only apply to IMPORTS. Don't want to pay the tariff taxes then don't import. It's not economic rocket science.
No US Corporation should be allowed to make hundreds of billions or millions of dollars and pay zero taxes. It's an insult to actual taxpayers.
And you can pretty much take your Jap car example and shove that too. Most of those care are made with at least 80% imported parts from the home country. Assembling them here mainly avoids shipping them by sea and those expenses and risks.
My Benz was assembled in the great state of Georgia was 100% imported except for the tires.
Cute. Totally oversimplified, but consider the audience you are lecturing.
Taxes on businesses are passed on to consumers. Just like a tariff tax. Where do you think the money comes from? Why are foreign suppliers exempt from those taxes all corporations should pay?
Then it's a level playing field. That only shows that union labor cannot compete with non-union labor inside the United States.
So, how would you avoid the tariff taxes? Demand another tax cut? Offshore jobs again? Beg for another government bailout?
Do you believe this is not the case? Of course the tariffs are paid first by the importing business. The consumers pay when the tariffs are passed onto consumers. The consumers experience higher prices and diminished supply.