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US President Trump's tariff policies have created a challenging environment for business leaders. Here's what some executives are saying about navigating tariffs, including CEOs from Coca-Cola (KO), Starbucks (SBUX), and AstraZeneca (AZN), and top executives at Meta (META), General Motors (GM), and Amazon (AMZN).
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It's now been one month since so-called liberation day, when President Trump made his tariff announcements. Since then, we haven't seen new deals, though the Trump administration says negotiations with nations, like India, Japan and South Korea, are nearing the finish line. The uncertainty has weighed on consumer confidence and caused some companies to lower and even withdraw their guidance. Here's what top executives have shared this earning season about the impact of tariffs on consumers and their businesses.
Look, if you look at the US business, the weakness in volume in Q1 was concentrated in what we call future consumption packaging, which is much more predominantly, uh, in, in, in supermarkets, or in kind of independent trade outlets, rather than either convenience, which I think is a partly an indication of some of the affordability pressure, uh, for the lower income consumers and some of the geopolitical reaction. Look, I think
consumers obviously are feeling some pressure. There's no doubt that you're seeing, uh, a consumer sentiment go down over the last couple of months. Uh, but I do think, uh, they're still being very choiceful in where they want to spend their money.
We believe that, uh, the best way forward is to not charge, uh, tariffs on pharmaceuticals, but, uh, create an environment that attracts investment through, uh, an attractive corporate tax rate.
Uh, the higher costs we expect to incur for infrastructure hardware this year really comes from, you know, suppliers who source from countries around the world. Um, and there's just a lot of uncertainty around this given the ongoing, um, trade discussions. We're also working on, you know, um, on our end on mitigations by optimizing our supply chain. And our outlook is really trying to reflect our best understanding of the potential impact, um, this year, you know, across all of that uncertainty.
Post clarity from the presidential actions of Tuesday, we are expecting a four to five billion dollar impact from tariffs. This includes about two billion dollars coming from vehicles we import from Korea, as well as tariffs on vehicle imports from Mexico and Canada in addition to indirect material imports.
Assuming the current global tariff rates, policies and applications do not change for the balance of the quarter, and no new tariffs are added, we estimate the impact to add 900 million dollars to our costs.
We've seen some heightened buying in certain categories that may indicate stocking up in advance of any potential tariff impact. But when you've got, uh, two million plus sellers, they're not all going to take the same strategy if there ends up being higher tariffs. I mean, there are there are going to be plenty of sellers that they decide to pass on those higher costs to end consumers. I think when you've got larger diversity like we have, um, we have a better chance of some of those sellers deciding that they're going to capture share and, um, and they're not going to pass on all or any of those tariffs to, uh, um, the customers.