President Donald Trump’s decision to impose an additional 10% tariff on U.S. imports from China could lead to higher prices for popular Mattel toys, including Barbie and Hot Wheels. The move adds to the pressure on toy manufacturers, many of whom rely heavily on Chinese production.
Mattel Chief Financial Officer Anthony DiSilvestro addressed the issue during Tuesday’s earnings call with Wall Street analysts. He noted that about 40% of Mattel’s toys are made in China—less than the industry average of 80%. However, the new tariffs will impact around 20% of Mattel’s global production.
“Against the tariff, we have a range of mitigating actions,” DiSilvestro said, mentioning the possibility of “potential price increases.” He emphasized that Mattel works closely with retail partners to balance pricing while keeping consumers in mind.
The tariffs come at a time when Mattel is reporting strong earnings, particularly in its vehicle toy category. Hot Wheels has emerged as the company’s fastest-growing segment, helping drive better-than-expected fourth-quarter results.
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Impact on retailers and consumers
Small toy sellers are bracing for the impact of the steeper U.S. tariffs. Dan Marshall, co-owner of Mischief Toy Store in St. Paul, Minnesota, expressed concerns that the higher costs could hurt businesses and consumers alike.
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“We’re going to suffer as a small business, but so is everyone in this country,” Marshall told CBS News Minnesota. He pointed out that there are few toy manufacturers left in the U.S., making it difficult to find alternatives to imported goods.
Marshall also mentioned that his store is trying to bring in products earlier in the year to avoid price increases. However, if costs rise too much, retailers may have no choice but to pass them on to consumers.
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Mattel also sources about 10% of its toys from Mexico, which was previously targeted with a 25% tariff. However, those tariffs have been put on hold for at least 30 days after Mexico and Canada agreed to strengthen border security measures with the U.S.
The impact of these tariffs extends beyond the toy industry. According to the Peterson Institute for International Economics, the combined effect of a 10% tariff on Chinese imports and a 25% duty on goods from Canada and Mexico would cost the average U.S. household more than $1,200 per year.
Mattel CEO Ynon Kreis acknowledged that the demand for dolls and baby gear has declined, with Barbie sales slowing down after last year’s movie-related surge. The toy industry is facing uncertain times, with tariffs adding another layer of financial strain for manufacturers, retailers, and consumers alike.
