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Costco Chief Financial Officer Gary Millerchip became the latest retail executive to warn that President-elect Trump’s proposed tariffs would raise costs for consumers.
In a recent earnings call, Millerchip told analysts that there is still “a lot of uncertainty about the timing and extent of changes,” making it difficult for anyone to predict with confidence what the impact will be.
Still, he acknowledged that, in general, “tariffs increase costs, so that’s not something we see as a positive.”
“When it rains, it rains for everyone,” he added.
WALMART WARNS OF HIGHER PRICES IF TRUMP IMPLEMENTS PROPOSED TARIFFS
Under Trump’s proposals, a universal tariff of 10% to 20% would be imposed on imports from all foreign countries, and an additional tariff of 60% to 100% would be imposed on imports specifically from China. Trump also said he will issue an executive order upon taking office to charge Mexico and Canada a 25 percent tariff on all goods coming into the US.
For Costco, Millerchip says its merchants and shoppers are equipped to navigate this situation because they’ve faced tariffs in the past.
The company has also bought inventory in the past “because of the lower predictability of shipping and the time the product spends in the water and also because of the risk of strikes that we’ve also seen in the past,” Millerchip said.
TRUMP’S TARIFFS WOULD RAISE CONSUMER PRICES: NATIONAL RETAIL FEDERATION
“Of course, we’re going to try to work with our vendors to make sure we’re looking at ways to mitigate the cost,” he said.
Earlier this month, dollar tree – which has a large exposure to China – warned that if the tariffs are implemented, the company may have to change product details or sizes and even get rid of items if they become too expensive.
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A Walmart spokesperson previously told FOX Business that the company remains “concerned that significantly increased fees could lead to increased costs for our customers at a time when they are still feeling the effects of inflation.”
Walmart Chief Financial Officer John David Rainey said during an interview with FOX Business in November that “the fees are going to be inflationary. That’s not debatable.”
Karoline Leavitt, Trump’s incoming White House press secretary, previously told FOX Business that during Trump’s first term, the tariffs imposed on China “created jobs, spurred investment, and did not cause inflation”.
He said Trump plans to restore the economy, in part, by “rebuilding American jobs, reducing inflation, raising real wages, cutting taxes, cutting regulations and unleashing American energy.”
