Much of the discussion around tariffs has been about the negative impact they’re likely to have on consumers and their purchasing power. But some companies, if not consumers, could see an upswing in business due to a trade war.
A lot of that depends on whether these tariffs are a short-term tool or a long-haul policy shift.
“I don’t think it would be wise for companies short-term, especially related to Mexico-Canada, to make any changes unless there is a fluid transition industry where it’s possible,” says Jack Buffington, an associate professor of practice and expert in supply chain management at the University of Denver.
“Longer-term, there are definite winners in the U.S. economy: lumber, energy, automotive, perhaps high-end electronics,” says Buffington. “The expectation is that this will lead to investment into the U.S. and if this happens, then it will be a boom for manufacturing.”
Here are some businesses that could benefit from a protracted trade war.
While not necessarily a household name, Cleveland-Cliffs (CLF) is one of the nation’s largest steel producers. “Country-specific tariffs on adversaries as well as allies are a great first step,” said CEO Lourenco Goncalves in a recent earnings report, “and we look forward to continuing to work with the Trump administration on further tariff action to come on steel specifically, against our adversaries and allies who have taken advantage of our market. A level playing field in steel will set the foundation to usher in a new golden era and a manufacturing renaissance that will make America strong again.”
The popular discount retailer stands to attract price-conscious consumers. While other apparel retailers will have to scramble to deal with tariffs on clothing made overseas, TJ Maxx (TJX) gets its clothes from close-outs and overstocks in the U.S., so tariffs will have little impact on its business model.
“I’m excited about the sales and margin opportunity in this environment,” said CEO Ernie Herman in a recent earnings call.
Tariffs will force many companies to ramp up domestic production — and that will mean more freight in the United States. “If it’s made in America, we’ll move it on rail,” CEO Joe Hinrichs told CNBC.
Arkansas-based J.B. Hunt (JBHT) is the largest intermodal freight provider in the U.S., and it stands to benefit for the same reason CSX (CSX) does: increased domestic production should equate to increased need for transport.
Consumers who don’t want to get hammered by buying items in China can pay for homegrown collectibles and crafts. “Etsy (ETSY) has much less dependence on products coming in from China,” Etsy CEO Josh Silverman told analysts on an earnings call in February. “To the extent that we see tariffs that are very focused on China … at least in the near-term, Etsy is a net beneficiary from that.”
Nuuly (URBN) is a clothing rental business, and renting clothes maybe become more appealing than buying if costs continue to spike. Owned by Urban Outfitters, Nuuly helped drive record profits for the Philadelphia-based lifestyle brand last year.
Why does the streamer make the list? If prices climb too high elsewhere — restaurants are likely to be severely impacted by tariffs — many consumers may just decide to stay home and chill. There won’t be a tariff on your Netflix (NFLX) subscription.
The post Netflix and 6 other companies that could be Trump trade war winners appeared first on Quartz.
