Barbie maker Mattel to reduce China dependence raise prices amid Trump tariff impact

Barbie-maker Mattel has announced plans to reduce its reliance on China-sourced products for the US market while raising prices in response to the tariff policies introduced under Donald Trump’s administration. The toy giant imports approximately 20% of the goods sold in the US from China but expects to lower this figure to below 15% by 2026. Half of Mattel’s global toy sales are generated from the US.

The trade tensions between the US and China have resulted in tariffs exceeding 100% on many goods, disrupting industries across the board. Mattel’s response has involved adjusting its supply chain, ramping up production in alternative markets such as India and shifting Chinese production to support international operations instead of the US market. For example, the company has increased production of the popular Uno card game in India to meet American demand.

The toy manufacturer has also confirmed price increases on certain products within the US. The company said these adjustments were necessary to mitigate additional costs stemming from the tariffs. Mattel’s CEO, Ynon Kreiz, acknowledged the significant challenges caused by the tariff landscape, highlighting how the industry has faced production disruptions, and stating support for the Toy Association’s campaign to abolish tariffs on toys.

According to projections, Mattel expects $270 million in extra costs linked to tariffs in the current financial year, starting with the third quarter. The company believes its efforts to adapt operations and pricing will offset this financial impact. Despite these adjustments, it had to withdraw its annual financial guidance, citing uncertainty in the wider economic environment and difficulty predicting consumer behaviour for the remainder of the year.

While Mattel is making strategic changes to deal with shifting trade dynamics, industry-wide disruptions persist. Carmaker Ford has already reported a potential $1.5 billion in costs tied to the trade war. Other automotive industry players, such as General Motors, have issued similar warnings over the financial blow expected from the tariffs.

The tariffs’ impact on US consumers has also sparked public debate. President Trump argued that fewer toys on the shelves might lead to simpler choices for children, downplaying the potential supply shortages. Mattel’s leadership, however, appears focused on counteracting these challenges with supply chain diversification and measured pricing strategies.