President Donald Trump’s tariffs could tax your wallet even as they attempt to spur U.S. job growth.
Trump’s tariffs of 25 percent on steel imports and 10 percent on aluminum tariffs, designed to reduce what he called the country’s “$800 billion trade deficit with the world,” went into effect in March. Canada, Mexico and the European Union are exempt — for now. Negotiations may lead to permanent exemptions for America’s closest allies.
“When costs of raw materials like steel and aluminum are artificially driven up, all Americans ultimately foot the bill in the form of higher prices,” warns Matthew Shay, president and CEO of the National Retail Federation.
“Prices are spiking, there’s no doubt about that,” Warren Buffett said this week at the annual shareholders meeting of Berkshire Hathaway, whose subsidiaries include steel users Precision Steel and MiTek.
In January, Trump announced tariffs on washing machines and solar panels.
Proposed are additional tariffs on 1,300 products — around $60 billion worth — imported from China. Trump says he wants to reduce the U.S. trade deficit with China, the difference between U.S. exports to and imports from that nation, which hit an all-time high of $375.2 billion in 2017. The proposal isn’t final, and Trump is considering tariffs on an additional $100 million worth of goods made in China.
If all the tariffs stick, you could pay more for everything from candy and canned goods to cake pans and cars, analysts say. It depends on how much of the tariffs’ cost manufacturers will pass along as price hikes for imported goods you buy. Also, domestic manufacturers may find room to raise prices once imports are more expensive or because they use imported parts even in products they label “Made in USA.”
Here’s a look at the 15 most likely tariff-driven price hikes to expect.
1. Clothes and shoes
While Trump’s proposed tariffs on goods from China spare apparel, they hit machinery such as textile printers and injection molders that American manufacturers use to make the clothes and shoes you buy.
“Tariffs on certain machinery will make American-made products more expensive,” Matthew Shay, president of the National Retail Federation, said in a statement reported by Bloomberg.
Such tariffs would “directly raise costs on domestic manufacturers and impact our ability to grow Made in USA,” the American Apparel & Footwear Association said.
Expect prices to rise 23 percent for TVs imported from China and 4.1 percent overall, said a joint report from the National Retail Federation (NRF) and the Consumer Technology Association (CTA).
A television made in China that costs $250 today would cost $308 if the proposed China tariffs are applied, the report said.
About 47 percent of all TVs sold in the U.S. are imported from China, according to the NRF-CTA report. Televisions from China differ from TVs imported from other countries, it said, so changing sourcing won’t be easy.
Similar to what will happen with TVs, expect prices of computer monitors from China to jump 23.5 percent, leading to an overall increase in monitor prices of 2.8 percent, the NRF-CTA report predicts.
About 83 percent of personal computer monitors sold in the U.S. are made in China, it said.
Battery prices for China imports would increase 23.8 percent while battery prices overall will edge up 0.8 percent as a result of the tariffs, the joint report predicted.
About 34 percent of lithium batteries sold in the U.S. come from China, it said.
5. Ink and cartridges
You’ll pay 22.7 percent more for ink and cartridges imported from China, predicted the NRF-CTA report.
Overall, your ink and cartridge prices will rise 4.1 percent, it said.
6. Washing machines
Consumers can expect prices on washing machines to rise 8 to 20 percent this year, bankers Goldman Sachs told CNBC in January. The prediction came after Trump announced plans to impose a 20 percent tariff on the first 1.2 million imported large residential washing machines the first year and a 50 percent tariff on machines above that number.
The tariff also includes a tax on machine parts, which could drive some costs higher for domestic manufacturers of washing machines as well.
Despite the prediction of higher prices, manufacturers see gains from Trump’s actions. “This is a victory for American workers and consumers alike,” Whirlpool Chairman Jeff Fettig said of the tariffs, promising new manufacturing jobs in Ohio, Kentucky, South Carolina and Tennessee.
Dishwashers from China also are on Trump’s list of proposed tariffs.
Tariffs could drive up the cost of your next new car or truck no matter where it’s made, automakers warn.
Besides the steel and aluminum tariffs expected to jump-start commodity price hikes, Trump has proposed to boost tariffs on European imports.
Honda, Ford, Toyota, General Motors and other car makers have issued statements warning that tariffs will boost the prices of cars and trucks sold in America even if they’re made with American steel and aluminum.
However, U.S. Commerce Secretary Wilbur Ross told CNBC that there’s about a ton of steel that now costs about $700 in an average car. “So 25 percent on that would be one half of 1 percent price increase on the typical $35,000 car. So it’s no big deal.”
That’s roughly $175 per car.
That Hog could cost you more, too.
“Import tariffs on steel and aluminum will drive up costs for all products made with these raw materials, regardless of their origin,” said Michael Pflughoeft, spokesman for Milwaukee-based Harley-Davidson, which has already suffered sales declines recently.
The increase in manufacturing costs would have “a significant impact” on sales, dealers, suppliers and customers, Pflughoeft said.
Think of tires as where the rubber meets the road when it comes to tariffs. That’s because high-quality steel wire rods are used inside tires, manufacturers warned.
The U.S. Tire Manufacturers Association (USTMA), whose members such as Pirelli, Bridgestone, Continental and others operate 56 tire-related manufacturing facilities in 18 states and generate over $27 billion in annual sales, said in a letter opposing steel tariffs that there is no domestic supply of these wire rods that are produced using oxygen furnace technology. U.S. steel manufacturers use electric arc furnace technology, which is less consistent, it said.
The cost of delivering your packages also may spike.
Not only would the cost of tires on fleets of delivery trucks rise, but steel tariffs could boost big-rig truck prices by $1,000 and the trailers they haul could rise another $900, experts predict.
Those costs could be passed along to customers by fleet-owning shipping companies.
11. Soup, soda and beer cans
U.S. Commerce Secretary Wilbur Ross on CNBC downplayed the possible price increase of a can of Campbell’s soup, Coca-Cola or Budweiser as a result of the tariff moves.
“A can of Campbell’s, a popular American soup brand, has 2.6 cents worth of steel. If the cost of that input rises by 25 percent, that adds an extra six-tenths of one cent onto the price of soup. Who wouldn’t be willing to pay that?”
Of a Coke, he said, aluminum tariffs would add 0.3 of a cent. He also mentioned beer cans.
Said Campbell’s: “Any new broad-based tariffs on imported tin plate steel — an insufficient amount of which is produced in the U.S. — will result in higher prices.”
Pennies add up, said the Can Manufacturers Institute, noting Americans use 119 billion food, beverage, aerosol and general line cans.
“Our initial calculations are the tariffs will increase the cost of the can by nearly 1 cent. This 1 cent average increase translates into $1.1 billion that our industry and consumers will unnecessarily pay to the U.S. government,” said Robert Budway, can institute president.
You might pan the tariffs if you’re buying new cookware made with aluminum.
The Vollrath Co. in Wisconsin, which makes cookware and bakeware items, told CNBC it had begun importing aluminum from China after local mills couldn’t meet its demand.
The company’s chief financial officer, Steve Heun, says the tariffs and other duties will make its aluminum products at least 20 percent more expensive than those of its foreign rivals. The tariffs will increase the company’s costs as much as $6 million a year, he said.
Candy prices may not be so sweet with the new tariffs, small and large chocolatiers said.
Steel and aluminum are as much a part of chocolate candy making as the tons of chocolate itself, they said.
“There’s steel and aluminum in our steel tables, trays, rolling racks, bowls, molds and equipment, which includes chocolate tempering machines, industrial mixers and depositors,” candy makers Erin Calvo-Bacci and Carlo Bacci, makers of CB Stuffers at Bacci Chocolate Design in Swampscott, Massachusetts, told the National Retail Federation.
Candy giant Hershey, which wraps Kisses and miniature Reese’s Peanut-Butter Cups in aluminum foil, echoed the Baccis.
“Such a broad and sweeping order could have a negative impact on the entire U.S. economy, potentially costing U.S. jobs and ultimately hurting American consumers through higher prices for everyday products,” Hershey spokesman Jeff Beckman said.
14. Medicines and medical devices
Do you take birth control pills? Need a vaccine? Or maybe plan on getting a knee or hip replacement?
Trump’s proposed China tariffs list includes dozens of drugs and medical devices, such as epinephrine, used to treat allergic reactions, and insulin, used to treat diabetes.
RBC Capital Markets estimated those proposed tariffs, if they take effect, will cost the medical device industry up to $1.5 billion each year, The New York Times News Service reported. The higher costs could result in price hikes largely affecting baby boomers, who are big recipients of hip and knee replacements.
Tariffs may even muddy the cost of your outdoor adventures.
Massimo Motor Sports told The Wall Street Journal the base for its all-terrain, two-seater utility vehicles is imported from China and would be subject to proposed tariffs.
The vehicles, finished at Massimo’s Garland, Texas, factory, retail for about $7,500. Company attorney Kris Alborz said Massimo may raise prices by about $1,500 apiece or find a new supplier if the tariffs take effect.
Still, Alborz told the Journal, Massimo owner David Shan, a Chinese immigrant, supports Trump’s tariff push.
“There is an unfair playing field here between America and China, and that unfair playing field does force manufacturers like us to purchase our units from China,” Alborz said.
Will the added costs of tariffs change your shopping strategies? Will they be worth it? Share your thoughts in comments below or on our Facebook page.