Walmart may be wading through dangerous waters with Donald Trump’s administration after announcing that the president’s tariffs would likely lead to price increases for consumers.
During CNBC’s Squawk Box Monday, co-host Andrew Ross Sorkin asked Tennessee Senator Bill Hagerty about the president’s recent outrage at Walmart. The mega-retail chain’s CFO warned last week that consumers might start to see higher prices on products as soon as June.
“In the short term, if Walmart decides that they have to raise prices, do you think that that’s un-American, effectively?” Sorkin asked.
“I think Walmart’s gonna have to make some decisions, Walmart has the broadest base of American clients there is. I think they’re gonna be very careful about how they do this. I know that they’ve received some criticism from the president. I think they need to think hard,” Hagerty replied.
Walmart’s CFO had explained that Walmart imports a third of its merchandise and food from other countries, with China being the largest supplier, followed by Mexico, Canada, India, and Vietnam, making it vulnerable to supply chain disruptions sparked by Trump’s sweeping reciprocal tariff policy. He also said that it wouldn’t be easy to adapt to changes in demand sparked by fluctuations in pricing.
Trump had hit back at the retail corporation in an angry post on Truth Social Saturday. “Walmart should STOP trying to blame Tariffs as the reason for raising prices throughout the chain,” he wrote.
The president advised Walmart, which had made more money than it expected, to “EAT THE TARIFFS” and not increase prices on consumer goods. CNBC reported that Walmart had beat earnings estimates but fallen short on sales.
“I’ll be watching, and so will your customers!!!” the president warned.
On Sunday, Treasury Secretary Scott Bessent was asked whether Trump’s “eat the tariffs” line meant that he wanted American companies to be “less profitable.” Bessent confirmed that Walmart CEO Doug McMillon had told him the company planned to “eat some of the tariffs.” The rest would likely still fall on consumers.
Last week, the White House announced that it had negotiated a lowered tariff rate of 30 percent on Chinese imports to the U.S. for the next 90 days.
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