Companies Are Serving Notice: We're Raising Prices Because of Tariffs

New York Times

02-05-2025

More companies are starting to warn that they will have to pass on higher costs to American consumers, raising prices for products like strollers, mattresses, power tools and cast-iron cookware as President Trump's tariffs take hold.
Some company officials said they had been left with no choice but to raise prices as they pay more to import goods and materials into the United States. Other firms have said they will soon run out of inventory for certain products because they have paused orders from China.
Mr. Trump has upended the global trading system, hitting foreign countries with punishing levies in an attempt to bring manufacturing jobs back to the United States and take aim at what he calls 'unfair' trade practices. But economic studies have found that the burden of higher tariffs typically falls on domestic consumers and companies.
Although Mr. Trump has scaled back some tariffs and paused others as he pursues trade deals with foreign nations, the impacts of his policies are already starting to eat into household budgets and frustrate Americans who have noticed higher prices for their goods.
Some major companies have recently warned about impending price increases.
Stanley Black & Decker said on Wednesday that it raised prices on its tools and outdoor products last month and will raise them again later this year. The German sportswear company Adidas said this week that steeper tariffs would eventually lead to higher prices for U.S. customers.
Executives at Procter & Gamble, which makes products like Bounty paper towels and Tide detergent, said last week that the company would most likely increase prices for some products to mitigate the effects of higher tariffs. And officials at Hasbro recently said the toymaker would 'have to raise prices,' although it would try to 'minimize the burden' on customers.
Some of the most immediate price increases have come in response to the elimination of a loophole that allowed items worth $800 or less from China to enter the United States without import fees. Shein and Temu, popular Chinese e-commerce platforms, began adjusting prices for U.S. customers last week ahead of the end of the tariff exemption on Friday.
Michelle Hall, a 48-year-old secretary in Snohomish, Wash., said she started buying products from Temu late last year and has since spent about $2,300 on furniture, car mats, sweaters, Christmas gifts and other inexpensive goods from the platform. 'It's addicting and fun when you get your packages,' Ms. Hall said.
But over the weekend, she discovered extra 'import charges' tacked onto her total. A cart of six items from Temu that would have usually cost her $83.80 would cost an extra $92.08 because of import fees, Ms. Hall said. On Wednesday, she noticed that the platform appeared to take down many products that would have incurred import fees, leaving only products that were shipped from local warehouses.
Ms. Hall said she planned to abandon Temu because she did not want to pay higher prices, and its offerings seemed more limited now.
She said she still hoped that Mr. Trump's tariffs would have some long-term benefits. She voted for Mr. Trump in November, initially thinking his trade policies could help reduce the deficit, create manufacturing jobs and make the nation less dependent on foreign countries.
But Ms. Hall said she was not sure if those benefits would materialize. 'In the meantime, I feel like citizens are suffering,' she said.
Ms. Hall said she never thought her own costs would increase, and she originally hoped that Mr. Trump would quickly bring prices down.
'I wanted to have faith,' she said. 'I don't have that faith anymore.'
Some companies have said they will begin raising prices in the coming weeks because of higher tariffs. Joanna Rosenberg, the chief sales and marketing officer at Zwilling J.A. Henckels, a German company that specializes in cutlery and other kitchen products, said the firm would have to raise prices for some products in early June. Premium knives from Zwilling and cast-iron cookware from Staub, one of the company's brands known for its Dutch ovens made in France, will see 'single-digit' price increases, Ms. Rosenberg said.
She said the company would have to raise prices more substantially for certain knives from its value brand, Henckels. Some of those knives are produced in China, which Mr. Trump has hit with a minimum 145 percent tariff. The president has signaled that the rate could drop, though the White House has insisted it will not do so unless China agrees to pare back its levies too.
'We don't want to increase prices,' Ms. Rosenberg said. 'There's just no way that we can absorb some of these price increases.'
Some industries are being hit particularly hard because the bulk of their products are made in China. About 90 percent of durable baby and children's products sold in the United States are manufactured overseas, with the vast majority produced in China, according to the Juvenile Products Manufacturers Association.
Several companies that sell strollers and car seats said they would have to increase prices to offset higher costs from tariffs. UPPAbaby said last month that it would adjust prices across most products. Evenflo increased prices between 10 to 40 percent for most of its products on Thursday. Cybex also increased prices for some products on Thursday, which company officials said was 'unavoidable.'
Steven Dunn, the chief executive of Munchkin, which sells products like high chairs, strollers and diaper pails, said the company will likely have to increase prices at a minimum of 20 percent for many products soon. And Mr. Dunn said the company might have to discontinue 30 to 40 percent of its products after its current inventory dwindles within an estimated 10 weeks.
'There are a lot of products that we just will not order anymore at the current rates,' Mr. Dunn said. 'You can't pass on a 145 percent tariff to the consumer and expect them to buy the same product.'
Mr. Dunn said that Munchkin paused its orders from China last month, and officials have tried to move as much manufacturing out of the country as possible. Although Mr. Trump has urged companies to make more products in the United States, producing more baby products domestically is complex. 'The tooling, the skills and the automation just doesn't exist here,' Mr. Dunn said.
Companies that make products in America are not immune to the impacts of higher import fees, either.
Vy Nguyen, the chief executive officer at Avocado Green Mattress, said all of its organic mattresses were made in the Los Angeles area. But many of the 'core natural components' that are used to make its mattresses, such as wool and latex, are sourced from countries including India, Thailand and Guatemala. Those materials have risen in price because Mr. Trump has instituted a 10 percent blanket tariff on nearly all trading partners.
Avocado plans to increase mattress prices by about 6 percent and other products by an average of 7.5 percent starting on Tuesday, company officials said.
Some brands have been more vocal about price increases because they are worried about their ability to pass on cost increases to consumers, said Simeon Siegel, a retail analyst at BMO Capital Markets. The companies want to ensure that consumers 'don't feel like they're having the rug pulled out from under them,' he said.
Réalisation Par, which sells an array of silk dresses, said in an email to customers last month that officials would have to raise prices for U.S. orders starting May 2 because its 'silk pieces have always been crafted with care and expertise in the home of silk — China.' In the meantime, customers could take 20 percent off their order until late April, according to the email.
Fatima Ocampo, a 24-year-old data analyst in Sacramento, Calif., said she was already eyeing several dresses from Réalisation Par when she saw the email. Ms. Ocampo said she was planning to wait to make a purchase, closer to when she will leave for her honeymoon in the south of France this fall. But she wanted to take advantage of the lower prices while she could, so she bought three dresses from the brand for about $400 later that day.
'I feel like it's a clear example of how these tariffs are going to be a burden put onto the consumer,' Ms. Ocampo said.