Trump warns U.S. companies against price hikes over tariffs

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By MG News | May 19, 2025 at 03:49 PM GMT+05:00

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May 19, 2025 (MLN): President Donald Trump has issued a strong warning to major U.S. corporations, cautioning them against using tariffs as a justification for raising prices.

His latest remarks, shared on Truth Social, were directed at Walmart after the retailer announced plans to increase some prices due to the rising costs linked to the global trade war.

“Walmart should STOP trying to blame Tariffs as the reason for raising prices throughout the chain,” Trump wrote.

“Between Walmart and China they should, as is said, ‘EAT THE TARIFFS,’ and not charge valued customers ANYTHING. I’ll be watching, and so will your customers!!!”

This marks the third instance in which the former president or his administration has publicly criticized a major company for mentioning potential price hikes due to tariff-related costs.

On April 29, following reports that Amazon considered displaying an additional tariff charge alongside product prices on its Haul platform, White House Press Secretary Karoline Leavitt responded during a press briefing by showing a photo of Amazon Chairman Jeff Bezos and labeling the move a “hostile and political act.”

Trump, described by a senior official as “pissed,” personally called Bezos to complain. Amazon later stated that while the idea was considered, it had not been approved and would not be implemented.

A week later, on May 6, Trump targeted toy manufacturer Mattel after it indicated that tariffs could lead to price increases, as CNN reported.

Mattel CEO Ynon Kreiz stated that manufacturing toys in the United States would not be feasible while maintaining affordability.

“We don’t see that happening,” Kreiz said in an interview with CNBC, warning that tariffs would push toy prices higher for American consumers.

Trump responded from the Oval Office, threatening to impose a 100% tariff on Mattel products, saying, “We’ll put a 100% tariff on his toys, and he won’t sell one toy in the United States, and that’s their biggest market. I wouldn’t wanna have him as an executive too long.”

Trump’s criticism focuses on large corporations and their profitability. He pointed out that Walmart made “BILLIONS OF DOLLARS last year, far more than expected.”

The claim aligns with the retailer’s strong 2024 performance, driven by cost-conscious consumers drawn to its low prices.

However, Walmart operates on thin margins, with an operating income just above 4% and a net profit margin under 3%.

Though Trump suggested the company could absorb the cost of tariffs, Walmart CEO Doug McMillon clarified the company’s stance during an earnings call.

“We will do our best to keep our prices as low as possible,” McMillon said. “But given the magnitude of the tariffs, even at the reduced levels announced this week, we aren’t able to absorb all the pressure given the reality of narrow retail margins.”

He added that Walmart would absorb some of the costs but not all, due to the need to maintain stable margins.

Despite Trump’s rebukes of Walmart, Amazon, and Mattel, other major retailers may follow similar paths.

Analysts are closely monitoring companies like Home Depot and Target for further signs of how tariff pressures might translate into higher prices for American consumers.

With Walmart, known for its scale and supply chain efficiency, unable to fully absorb tariff costs, questions arise about whether any company can avoid passing some of that burden onto customers.

While Trump’s warnings are loud, economic realities suggest higher prices may be unavoidable.

Copyright Mettis Link News

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