Toymakers hit heavily by Trump’s trade war

Toymakers hit heavily by Trump’s trade war

Business

Christmas is the most wonderful time for US toymakers every year. But except this time, toymakers are facing death kneel due to the US-China trade war. Trump will be imposing $155 billion on Chinese products that are imported to the US. Jay Foreman, CEO of Basic Fun, said that this is a nightmare before Christmas. Previous impositions of tariffs have affected US farmers and good industrial manufacturers. This time tariffs will be imposed on laptops, tablets, cellphones, school and office supplies, Christmas ornaments, and toys.

Rick Woldenberg, CEO of Illinois, is shocked and said that this is just like a TV reality show, and he is not able to get off the stage. He has to pay 15% duty in just 11 days. Rick says that this tariff will cut down all his profits made in 2019, along with the incentives and bonuses for his staff. The business of toys is tough, having very fewer profit margins, and it is a very price-sensitive market. Foreman predicts that many businesses will go out due to this Trump’s trade war. Talks between the US and China, are going and there is a possibility that the tariffs will be scrapped. Trump said that he would not do a deal until the 2020 elections. The consequences of the trade war are widening and affecting politically and economically.

The farmers of Brazil are burning lands of Amazon to plant soybeans to supply to China, thereby replacing the US supplies. Foreman compared this trade war with hurricanes that threaten to strike his house annually in Florida. Trump made a tweet that weak and badly operated companies are blaming tariffs instead of accepting their bad management. Foreman said that businesses are the backbone of the economy, and this is for the very first time that any president is criticizing small businesses. Many US manufacturers are dependent on cheap Chinese labors and more than 70% of the US toys are manufactured in China. Trump suggests to take back their manufacturing seems impractical for the manufacturers. According to JP Morgan, nobody is winning this race.

Arya Green

Arya, our senior correspondent for business updates, have worked in the industry for more than a decade as an executive and in other roles. Right now, she focuses on covering business updates that matter to not just the commons but also professionals like investors. She is a great lover of books and is planning on writing the ultimate guide on business analytics.

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