new York
Cnn
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The largest American companies say that the erratic trade policies of President Donald Trump lead consumers to spend less on plane tickets and burritos, increasing the costs for businesses and making it impossible to plan future investments.
Pepsico, American Airlines, Chipotle, IBM, Procter & Gamble and other companies announced this week the quarterly profits, giving investors their first public comments on the impact of Trump’s prices. They have all indicated that import taxes harm consumers and the economy.
“We are expecting more volatility and uncertainty, in particular linked to global trade developments, which, in our view, will increase our costs in the supply chain,” PDG of Pepsico said Ramon Laguarta, in a press release. The company has reduced its prospects for the full year.
The Trump administration has made a series of dizzying ads on prices on imported goods, the heaviest in China, causing countries to retaliate with their own prices. The United States has imposed a universal rate of 10% on almost all goods in the country, more higher rates for certain goods and 145% of prices on China – essentially a commercial embargo on the second world economy.
These political decisions of the whiplash, as well as a slowdown in consumers, were a nightmare for the largest American companies.
Burritos and diapers
Companies have not called Trump by name, but they all say that the prices are wreaking havoc.
Chipotle pointed out its first decrease in quarterly sales in open stores for at least a year from the COVVI-19 pandemic. The chain also said that prices will increase the cost of imported ingredients, such as Australian beef and Pérou lawyers.
The concerns about the economy “were the overwhelming reason for the reasons why consumers reduced the frequency of catering visits,” said CEO of Chipotle, Scott Boatwright, during a call with analysts.
Procter & Gamble, the manufacturer of Pampers, TIDE and other household brands, has reduced his sales advice for the year and that the prices will likely lead to an increase in prices.
“The prices are intrinsically inflationary,” said CEO of Procter & Gamble Jon Moeller on Thursday in an interview on CNBC. He said Procter & Gamble prices will probably increase from July, and the company will also seek to modify some of the formulas of its products to compensate for the impact of prices.
Plane tickets and hotels
Prices and economic pressure also harm air trips. American Airlines, Delta, Southwest and Alaska Air have all drawn their financial orientations for the year, citing economic uncertainty. American Airlines said it would make the cost of new planes to consumers.
The vice-president of American Airlines, Steve Johnson, told analysts on Thursday that the low-income Americans are in particular steal.
“We believe that it is above all our customers most sensitive to prices, for whom travel is the most discretionary,” he said.
Hotels and industries stuck by tourism have also been affected by fewer people traveling to America.
Leisure and hospitality companies across the country have declared fewer Canadian tourists, partly a response to Trump policies, according to the periodic investigation of the federal reserve on companies across the country.
An owner of the New York Hotel reported to the Fed “a fall in international reserves and contacts in New York near the border have seen declining Canadians.”
“Canada’s trips have declined considerably and contacts feared that the summer trip from Europe and China can also suffer due to negative reactions to American pricing policies,” said Fed report.
American brand “erod”
The prices also sent the stock markets diving and slows down the economy.
The DOW dropped 9.1% in the first three weeks of April, the worst index performance for all April since 1932. The Trump trade war will slow down global economic growth this year, the International Monetary Fund this week said.
Economists largely say that there is a high risk of American recession this year – perhaps up to 50% to 70% chance – due to the Trump administration’s commercial approach.
The main business leaders have publicly criticized Trump’s trade policies in recent weeks.
CEO of Citadel, Ken Griffin, a billionaire of Trump and Megadoneur of the Republican candidates, said that the president’s trade war injured the American position in the world.
“The United States was more than a nation. This is a brand,” Griffin told Semaor World Economy Summit on Washington on Wednesday. “It was like a suction for most of the world. And we are eroding this brand at the moment. ”
