Feb. 5 (UPI) — The cost might rise for Barbie dolls, Hot Wheels cars and other Mattel products due to the Trump administration’s handling of tariffs on goods produced in China, Mexico and Canada.
Mattel officials in the company’s 2024 financial results report released Tuesday cite the proposed 25% tariff on goods produced in Mexico and Canada and a 10% increase on goods produced in China as having a potentially negative effect on the company’s investors and the cost of its products.
“Changes in the amount, scope and nature of the tariffs in the future, any countermeasures that the target countries may take and any mitigating actions that may become available could increase Mattel’s product costs and other costs of doing business,” Mattel officials said.
“Other changes in laws or regulations in the United States and/or in other major markets, such as China, in which Mattel operates … may also increase Mattel’s product costs and other costs of doing business and in each case reduce Mattel’s earnings and liquidity,” Mattel said.
The potential changes in laws and regulations could include taxes, trade policies, product safety or sustainability that affect corporate earnings and liquidity.
The changes could especially affect the cost of doing business in China and Mexico, where Mattel produces 40% and less than 10% of its toys, respectively.
With China and Mexico accounting for nearly half of all goods produced and sold by Mattel in the United States, the domestic cost of its toys and other products might rise by a corresponding amount.
“Certainly against the tariff, we have a range of mitigating actions,” including adjusting supply chains and “price increases,” Mattel Chief Financial Officer Anthony DiSilvestro told investors and media during a Tuesday conference call, CNBC reported.
DiSilvestro said Mattel officials “always keep consumers in mind” when considering changing the prices of its goods and work with the toy-maker’s retail partners to “achieve the right balance.”
President Donald Trump earlier this week imposed a 10% tariff increase on goods imported from China but delayed for 30 days executive orders imposing 25% tariffs on goods produced in Mexico and Canada.
Officials in Mexico and Canada have agreed to work with the Trump administration to curtail illegal borer crossings and the flow of fentanyl, methamphetamine and other potentially deadly drugs into the United States instead of engaging in a trade war.
Trump also wants China to do more to end the importation of precursor ingredients used to manufacture fentanyl in Mexico and Canada for eventual distribution in the United States.
Fentanyl is a synthetic opioid that is 50 times more potent than heroin and 100 times more potent than morphine.
Drug overdoses killed an estimated 107,543 people in the United States in 2023, including 81,083 from opioids, the Centers for Disease Control and Prevention reported in May.