Andrew Ross Sorkin, Ravi Mattu, Bernhard Warner, Sarah Kessler, Michael J. de la Merced, Lauren Hirsch, Edmund Lee and
Trump’s price war
At a rally in Michigan last night, President Trump declared that “we’re ending the inflation nightmare.” But corporate chiefs are bracing for the opposite, revealing a split-screen view of the future that has sharpened as trade uncertainty grows.
Companies have warned for weeks that tariffs could scramble supply chains, force them to tear up their financial outlooks and raise prices. (More on that below.) Yet they now face a new dilemma: Should they be transparent with shoppers about why prices are increasing, or — as Amazon learned on Tuesday — risk drawing Trump’s fury?
A recap: Trump called Jeff Bezos on Tuesday to fume over a report by Punchbowl News that the retailing giant had planned to detail how tariffs contribute to price increases. The purported move, which Amazon has denied, would have illustrated the real-world effects of the president’s trade policy, which is already hitting the Chinese e-commerce giants Temu and Shein.
Karoline Leavitt, the White House press secretary, delivered an extraordinary rebuke of Amazon during Tuesday’s news briefing, accusing the retailer of being “hostile and political.” Amazon said it had weighed such a move for Amazon Haul, its Temu competitor, but decided not to — and had never considered it for its main site.
Still, the conundrum companies face seems clear. Do they eat tariff-related cost increases and hurt their bottom line, and investors? Do they pass the higher costs onto shoppers, potentially drawing their ire?
Or do they level with consumers, and dare angering Trump?
Stifling price transparency could backfire on Trump, Paul Donovan, the chief economist for UBS Global Wealth Management, told DealBook. Without clear pricing information, Democrats and independents could argue that all price hikes — including non-tariff ones — were Trump’s fault, he said.
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