Prices at Walmart are likely to rise, according to the company’s CEO, John David Rainey. This is primarily due to the store’s reliance on imports from China, which is expected to be heavily affected by the import tariffs President-elect Donald Trump plans to impose. Approximately 70% to 80% of Walmart’s suppliers come from China, and Trump’s campaign promises included imposing tariffs of 10% to 20% on all imported goods, with a 60% tariff on Chinese goods specifically. Following his victory, he announced intentions to impose tariffs of 10% on China and 25% on Mexico and Canada starting January 20.
Rainey emphasized that Walmart’s model relies on offering “everyday low prices,” but he acknowledged that some products might see price increases due to these tariffs. He did not specify which products would be affected, but said the company would work with suppliers and its own private brands to mitigate price hikes.
The situation has sparked concerns about “reflation,” a period of rising prices as consumers are still recovering from high inflation rates in 2022 and 2023. A significant portion of U.S. imports comes from China, particularly electronic equipment, machinery, and pharmaceutical products, all of which could be subject to tariffs. The U.S. also imports a large percentage of its crude oil from Canada and Mexico, which could also be impacted by new tariffs.
While Trump argued that tariffs would benefit U.S. businesses, some business leaders are concerned about the long-term effects. For instance, following the imposition of tariffs on aluminum and steel in 2018, the steel industry saw job losses before recovering. The Tax Foundation estimated that Trump’s proposed tariffs could generate $1.2 trillion in tax revenue but also lead to nearly 345,000 lost jobs and a reduction in GDP by 0.4%.
Ultimately, the burden of these tariffs is likely to fall on consumers. Rainey isn’t the only CEO warning of price increases — Best Buy’s CEO, Corrie Barry, has also indicated that electronics, which are heavily imported, may see price hikes as a result of the tariffs. She emphasized that higher prices for essential goods would be detrimental to consumers.
