Donald Trump Puts AriZona's 99-Cent Iced Tea Under Threat

Newsweek

8 hours ago

Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources.
Newsweek AI is in beta. Translations may contain inaccuracies—please refer to the original content.
The founder of AriZona Iced Tea has been forced to consider increasing the price of the company's signature tallboy beverages as a result of President Donald Trump's tariffs on aluminum imports.
Newsweek contacted the AriZona Beverage Company via email outside of regular business hours for comment.
Why It Matters
AriZona has steadfastly stuck by its 99-cent pricing, despite economic pressures and inflation, which would otherwise push this to double that level. Vultaggio told NBC News last year that the company would "fight as hard as we can" to ensure cash-strapped consumers were able to buy the products at the long-held price.
The potential change indicates the pressure facing those in the beverage sector and other metals-reliant industries as a result of the recent tariff hike.
What To Know
Since the early 1990s, the AriZona Beverage Company has held the price of its "Big Can" drinks at $0.99, but Don Vultaggio told The New York Times: "At some point the consumer is going to have to pay the price."
"I hate even the thought of it," Vultaggio added. "It would be a hell of a shame after 30-plus years."
In June, Trump announced that he would be doubling tariffs on imported steel and aluminum to 50 percent, from the 25 percent rate announced in February.
"I have determined that increasing the previously imposed tariffs will provide greater support to these industries and reduce or eliminate the national security threat posed by imports of steel and aluminum articles and their derivative articles," Trump said.
The U.S. imports around half of the aluminum used domestically, and representatives of the U.S. aluminum sector have warned that this move could endanger them, as well as other aluminum- and steel-reliant industries.
"Reestablishing a more level playing field for domestic producers is critical, but a Section 232 tariff of 50 percent threatens to undermine the very industry the administration aims to support," said Charles Johnson, president and CEO of The Aluminum Association.
"The Aluminum Association, which represents the full industry supply chain and 70 percent of domestic production, urges the administration to reconsider today's decision given the negative impact it will have on manufacturers."
Robert Budway, outgoing president of the Can Manufacturers Institute said similarly that this will "further increase the cost of canned goods at the grocery store," and "put our nation's food security at risk."
Don Vultaggio, founder of the AriZona Beverage Company, attends AriZona Iced Tea's "AriZonaLand" Grand Opening on September 19, 2024, in Edison, New Jersey.
Don Vultaggio, founder of the AriZona Beverage Company, attends AriZona Iced Tea's "AriZonaLand" Grand Opening on September 19, 2024, in Edison, New Jersey.for AriZona Iced Tea
AriZona, which imports 20 percent of its aluminum from Canada, has not yet formally announced plans to raise its prices. However, it is one of many that have said the metals tariffs could force its hand in the future, a step some have already taken.
Maryland-based Independent Can has raised its prices twice this year, CEO Rick Huether telling NBC News in July that the packaging company has already "absorbed the amount of the tariffs that we can absorb."
Meanwhile, Coca-Cola CEO James Quincey told investors in February that the reliance on imported aluminum from Canada could force the company to rely more heavily on plastic packaging to "compete in the affordability space."
What People Are Saying
New York Democratic Representative Ritchie Torres, via X, formerly Twitter: "Since 1997, AriZona Iced Tea has proudly kept its iconic 99-cent price tag. For the first time in nearly three decades, Trump's tariffs (effectively a tax on American consumers and businesses) threaten to double that price to $1.99. Trump promised to lower prices. Instead, he's driving them up."
A group of over 20 companies from the food, beverage and can-producing sectors, in February letter to President Donald Trump, wrote: "We understand your efforts to use tariffs and other broad trade tools to level the global economic playing field and make our country's economy great again. However, the unintended consequences of these measures—if not properly tailored and implemented—are extremely detrimental to American food producers, farmers, and metal can makers and, hence, our nation's food security."
What Happens Next?
Despite requests from the industry, no exemptions from the metals tariffs have been granted to U.S. can producers.
In addition to these, the administration has imposed sectoral tariffs on automobiles and components, copper parts, and is working to implement more on semiconductors, pharmaceuticals and critical minerals.