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PepsiCo (PEP) CEO Ramon Laguarta sits down with Yahoo Finance Executive Editor Brian Sozzi at the World Economic Forum in Davos, Switzerland, to discuss the impact of US President Donald Trump's return to the White House.
With the president threatening tariffs on all imports into the US, Laguarta says, "Of course," Pepsi could be impacted, but "to a very small extent because we are a company that is local for local."
The CEO explains, "We're mainly an agriculture company, and we source most of our crops from the local markets where we service consumers ... We have some parts of our business that have been exposed to [the] international movement of raw materials. It's a small part of our business." He adds, "We've done a lot of work on becoming more resilient, more local, having more supply chains that can stand different disruptions that may happen around the world."
Amid worries about Trump fueling a trade war, Laguarta says, "I am hopeful that the current administration will help us close some of the big wars that we have today in the world," specifically in the Middle East and in Ukraine, both of which the CEO says impact PepsiCo's business.
Are tariffs a threat to your business, for those investors not familiar with the PepsiCo model? They they Of course. We we could be impacted, but I would say, uh, to a very small extent because we are a company that is local for local. The fact that I was saying earlier, we're mainly an agriculture company and we source most of our, uh, crops from the local markets where we service consumers. So you could think you should think about us as a, okay, potato being grown in Turkey to serve the Turkish consumers, or potato being grown in, uh, uh, England to serve the English consumer. So that that's the nature. We have some parts of our business that are being exposed to, uh, international, uh, uh, movement of of raw materials. It's a small part of our business. Uh, we've been working obviously on resiliency of our supply chain. Uh, geopolitics have been in important in the last few years as you can imagine. So we've done a lot of work on becoming more resilient, more local, having more, um, you know, supply chains that can stand, uh, different disruptions that may happen around the world.
Is it harder today to be a public company global just global company compared to five days ago when President Biden was still in the house? I mean so I I'm hearing so much concern about global trade wars.
Listen, I I I'm hopeful that, um, the current administration will help us, um, close some of the big wars that we have today in the world. Uh, so both, uh, you know, the stability of the Middle East is very relevant for us as a company. We have a big business in the Middle East. And also the Ukraine war is is impacted us. We have a lot of, uh, associates in that part of the world. And so, um I'm hopeful that there will be a new energy, new, uh, ideas coming into play to, uh, close down those two, uh, you know, very negative events for people, but also for businesses and communities.
Catch Yahoo Finance’s full interview with PepsiCo CEO Ramon Laguarta here.
Click here for more of Yahoo Finance's coverage from the World Economic Forum in Davos.
This post was written by Naomi Buchanan.
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