American companies prepare for the impact of Trump -Tolls
8 mins read

American companies prepare for the impact of Trump -Tolls

Washington -Arn an ice cream bar in California to a medical delivery business in North Carolina to a T-shirt salesman outside Detroit, American companies are to take a hit from the taxes that President Donald Trump introduced Saturday on import from Canada, Mexico and China’s three largest trading partners .

Fees – 25% in Canadian and Mexican and 10% on Chinese goods – will come into force Tuesday. Canadian energy, including oil, natural gas and electricity, will be taxed at a lower 10%.

Mexico’s president immediately ordered retaliation tariffs and Canada’s Prime Minister said the country would set matching $ 25% up to $ 155 billion in US imports. China did not immediately respond to Trump’s action.

The Budget Laboratory at Yale University estimates that Trump’s customs will cost the average US household $ 1,000 to $ 1,200 in annual purchasing power.

Gregory Daco, chief economist at the tax and consulting company EY, estimates that customs would increase inflation, which was at 2.9% annual interest rate in December, by 0.4 percentage points this year. Daco also projects that the US economy, which increased 2.8% last year, would fall by 1.5% this year and 2.1% 2026 “as higher import costs dampen consumer expenses and business investments.”

Penny Ice Creamerry in Santa Cruz, California, has had to raise prices on its ice cream – including popular flavors “Strawberry Pink Peppercorn” and “Chocolate Caramel Sea Salt” – repeatedly in recent years when an inflation plant increased cost for its deliveries .

“I feel bad to always have to raise prices,” said co -owner Zach Davis. “We were looking forward to inflation to come down, the economy stabilized in 2025 … Now with customs we can be back on it again. ”

Trump duties, said Davis, threatens to increase the cost of the mostly refrigerators, freezers and mixers he will need if Penny Ice Creamerry continues with plans to add his six stores. He still has painful memories from the extra equipment costs the company to absorb when Trump beat massive tariffs in China during his first term.

The new customs will also raise the price of a customer favorite – Sprinkles – such as Penny Ice Creamerry Imports from a company in Whitby, Ontario. To deal with a 25% import tax on even something as small as it can hurt a small company as his.

“The margins are so narrow,” he said. “Being able to offer that supplement may generate another 10 cents in profit per scoop. If a customs dries it out, it may really be the difference between being profitable and being break-ven . ”

In Asheville, North Carolina, Casey Hite, CEO of Aeroflow Health, counts to take a hit because his company gets more than half of his deliveries – including breast pumps – from Chinese manufacturers, giving them to American patients through insurance plans. Aeroflow Health gets paid by insurance companies at negotiated prices, introduced before Trump decided on his customs.

Hite said that the tax on Chinese imports would hit the company’s finances and force it either to buy cheaper and lower quality products or manage higher costs through higher health insurance premiums. It may take two years to realize, Hite said, but eventually they would hit the consumer budget.

“It will affect the patients,” Hite said. “Over time, patients pay more for the products.”

Even the manufactured absorbent incontinence pillows Aeroflow Health purchases are not secure from Trump’s import taxes. They can include mass from customs target Canada and plastic and packaging from China, according to Aeroflow Health, which warns of “turbulence” from the customs.

“Will this affect our business? You bet it is, “said Linda Schlesinger -Wagner, who owns Skintees, a women’s clothing company in Birmingham, Michigan, which imports clothes from China. She said that the 10% tax would increase her costs, even if she plans to absorb Extra cost instead of transferring it to customers.

“I don’t like what is happening,” she said, referring to the broader impact of customs. “And I think people will be really shocked at the pricing they will look at the cars, on timber on the clothes, on the food.

William Reinsch, a former US trade officer now with the Center for Strategic and International Studies, said that many companies that filled imported goods in advance to avoid customs. They will be able to pull on their stacked inventories for weeks or a few months and delay their customers’ pain.

George Carrillo, CEO of Hispanic Construction Council, an industry advocate, said that construction companies have hammered material pending Trump’s actions, but he is worried about the possibility of inflation spikes within three to six months.

“When that inventory starts to get low, we will start to feel the effects,” Carillo said in a telephone interview Saturday, before the announcement. “Developers and construction contractors must keep up with the pace and they will start to buy more products and it will be at a higher price point.”

Everything that will be aggravated by a growing breakdown of immigration that is already screaming the construction industry’s work pool, he said.

“You put tariffs and put instability into the workforce, it will create large delays in projects. It will create a price increase due to the lack of accessibility,” Carrillo said.

Then there are industries that do not have the luxury of storage, including supermarkets whose agricultural products will destroy. So the impact will emerge on food shelves within a few days.

“You don’t store avocado,” Reinsch said. “You don’t store flowers. You don’t store bananas. ”

In the tomato trading hub in Nogales, Arizona, supplier produces Rod Sbragia, who followed his father into the business almost four decades ago, is worried that the import fees will force some distribution companies from the business and “would be harmful to the American consumer, to the elections They have in the supermarket. “

Sbragia voted for Trump during the last three elections and calls himself a “constant Republican.” The president, he said, must not have received proper advice on the matter.

“When we are worried about the costs of consumers, inflation pressure and the general health of our population,” he asked, “why will we make it more difficult to access fresh fruits and vegetables?”

American farmers are also likely to get caught up in Trump’s trading with Canada, China and Mexico. The president’s supporters in the countryside in America make a tempting target for retaliation. That was what happened during Trump’s first mandate when other countries, especially China, fought back to the president’s customs with own fees on things like soybeans and pork. In response, Trump spent billions in taxpayers’ money to compensate them for lost sales and lower prices.

Many farmers now expect the president to come through and protect them from reprisals.

“The Trump administration provided a security network,” said former tobacco grower Lee Wicker, Deputy Director of the North Carolina Growers Association, a collection of 700 farms that legally submit foreign temporary workers to work the fields through a federal visa program. Many of the association’s farmers “trust him that he will take care of everyone who has been injured by the customs, and that is really all we can ask for.”

AP personnel writer Mae Anderson and Cedar Attanasio in New York; Mike householder in Birmingham, Michigan; Gary Robertson in Raleigh, North Carolina; Gabriel Sandoval in Phoenix; And Didi Tang and Christopher Rugaber in Washington contributed to this story.