Get ready to pay more for your kids’ toys this fall. Hasbro, a giant in the American toy industry, has sounded the alarm on rising prices due to new tariffs on imports. This isn’t just a blip—it’s a policy-driven hit to your wallet.
According to the Daily Mail, under the Trump administration’s push for an “America First” approach, tariffs on imports from China and Vietnam are set to drive up toy costs from August through October, as announced by Hasbro CEO Chris Cocks.
Let’s rewind to April, when the administration first slapped a minimum 10% tariff on U.S. imports. The stock market tanked in response, prompting a 90-day pause on the policy. That pause has now been delayed further, with tariffs kicking back in on August 1.
China, a major hub for U.S. imports, now faces a steep 30% tariff. Vietnam isn’t spared either, with a 20% tariff under a separate agreement. These rates are down from past highs—China once faced tariffs as high as 145%—but they still sting.
Hasbro, known for iconic brands like My Little Pony, Transformers, and Scrabble, relies heavily on suppliers in both countries. Other giants like Mattel, with nearly half its production in China and 10% in Mexico, are also bracing for impact.
Mattel’s 2024 financial report paints a grim picture. It warns that shifts in tariff policies could inflate product costs and squeeze earnings. Liquidity could take a hit too, as business expenses climb.
Why the delay until August? Toy production timelines typically span three to five months, meaning the tariff effects won’t hit shelves immediately. As Cocks noted on CNN’s The Assignment podcast, consumers will likely “see them in the August through October timeframe.”
What does this mean for prices? A doll that retails for $10 could jump to $18 if made in the U.S., due to labor costs eating up 80-90% of production expenses.
Cocks explained, “If you took the same toy and manufactured it in the US, labor would make up 80 to 90 percent of the cost.” It’s a stark reminder of how policy shifts ripple through to everyday purchases.
Hasbro has tried to pivot, moving some production to the U.S. to dodge tariffs. But this isn’t a silver bullet—higher labor costs here could offset any savings. It’s a tough balancing act for a company already navigating global supply chains.
The administration argues foreign nations should bear these tariff burdens. Cocks pushed back, stating, “It’s always a business working with another business that absorbs things.” Ultimately, though, it’s consumers who’ll likely foot the bill.
Hasbro isn’t in dire straits yet, thanks to strong profits from its gaming division. Cocks even expressed sympathy for peers, saying, “I feel more for my toy industry CEO peers than I do necessarily for my day-to-day challenges.”
For families, this is a signal to plan. Stock up on toys before the August price surge if budgets are tight. Frugality now could save you a bundle later. Investors should keep an eye on Hasbro and Mattel stocks as tariff policies unfold. While Hasbro’s gaming revenue offers a buffer, smaller players might struggle, potentially creating buying opportunities during dips.
At its core, this story exposes the hidden costs of protectionist policies. Tariffs may aim to boost domestic production, but they often distort markets and burden consumers. Stay informed, spend wisely, and invest with caution as this unfolds.