Black Friday 2018 could be the last truly cheap Black
Friday due to incoming tariffs from Donald Trump’s trade war
2018 has not seen widespread increases because the
tariffs are not all in place yet, and take time to filter down
By this time next year, the full effects are likely to
“It’s almost like this year and next year are two
different worlds,” one retail head said.
Major outlets have said publicly that their prices are
likely to go up soon.
This year could be the last truly cheap Black Friday, thanks to
expected price increases resulting from President Donald Trump’s
trade war with China.
However, by this time next year, the consequences of measure
including a 25% tariff on billions worth of Chinese goods
will have made their way to store shelves, and hamper retailers’
ability to offer rock-bottom prices.
Christopher Shaker, a consumer products analyst and partner
at consulting firm RSM, told
CNN Business: “Once you get to that 25% mark, that’s when
you’re going to see more price increases for the end
Major outlets like
Costco, Walmart, GAP, Coca-Cola, and General Motors
have commented publicly on the tariffs, and said they either
plan to increase prices to cope, or are already doing so.
Billions worth of Chinese goods, including handbags,
wallets, and perfumes, have been subject to a 10% tariff since
September, which is due to increase to 25% in January
But this hasn’t had a big effect on consumers this year, as
many of the items were priced before the tariffs came into
effect, Rick Helfenbein, president of the American Apparel and
Footwear Association, told CNN Business.
Therefore two upward pressures will hit at once in 2019:
prices will catch up with the 10% tariff, and then be clobbered
again by the hike to 25%.
“It’s almost like this year and next year are two different
worlds,” Helfenbein said.
“Shoppers may be pardoned this Thanksgiving season, but they’ll
be paying more come spring,” he added.
Retailers are warning that this will be the case.
JCPenney counsel David M. Spooner wrote a letter
to US Trade Representative Robert Lighthizer in September
warning that “No retailer will be able to simply absorb
the cost of a 10% percent tariff, much less a 25% tariff in
today’s ultracompetitive retail environment. That means
consumers will pay higher prices.”
Matthew Shay, president and CEO of the National Retail
said in September, “with these latest tariffs, many
hardworking Americans will soon wonder why their shopping bills
are higher and their budgets feel stretched.”
Trump will meet with Chinese President Xi Jinping at
the G20 Summit in Buenos Aires, Argentina, next week, and some
hope that a dialling-down of the trade war could follow.
But Chinese trade negotiators canceled
preliminary meetings with the US this week.
Around the same time, the Trump administration
released a report which said that Beijing has done little to
placate the US.
Wilbur Ross defended the 10% tariffs in September, saying
that consumers would not notice the increase.
The White House has appeared unsympathetic to companies
likely to hike prices on Chinese imports. When it seemed as if
Apple may be affected, even though some
products have since been spared from tariffs, he tweeted
saying: “Apple prices may increase because of the massive Tariffs
we may be imposing on China – but there is an easy solution where
there would be ZERO tax, and indeed a tax incentive.
“Make your products in the United States instead of China.
Start building new plants now. Exciting!”
Business Insider has contacted the White House for