How Companies Are Making Customers Pay for Trump's Trade War (NYT)
https://www.nytimes.com/2018/07/30/business/dealbook/trade-war-customers-pay.html
How Companies Are Making Customers Pay for Trumps Trade War
By Peter Eavis
July 30, 2018
President Trumps trade war is making life uncomfortable for some large American corporations, but they have found a way to reduce the pain: Pass it on to customers.
The Trump administrations tariffs have pushed up the prices of steel and aluminum and have raised costs for companies that make everything from cars and tractors to dishwashers. These companies face a choice. They can bear the higher costs themselves and report weaker profits, which might crater their stocks. Or they can charge more for their products, in effect making their customers bear much of the financial burden of the tariffs, at least for a while.
Many companies are opting for the latter.
As they report second-quarter earnings, they are going out of their way to let their shareholders know that it is customers who are paying.
Caterpillar, while reporting record profits on Monday, predicted that tariffs would add as much $200 million to its costs in the second half of this year. The company added, however, that it would try to partly offset the hit by increasing the prices of its products. Whirlpool, which uses steel and aluminum in its dishwashers and washing machines, said it had hoisted its prices this year. Coca-Cola said last week that it had increased prices in the United States in part because of tariff-related cost increases.
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