Mattel is contemplating price increases for U.S. toy consumers, influenced by President Trump’s tariffs and recent comments suggesting American children require fewer dolls. CEO Ynon Kreiz emphasized that while Mattel aims to provide quality toys at affordable prices, tariffs may necessitate price adjustments. Analysts caution that consumers are sensitive to toy prices and that household spending on toys may be constrained after years of increased costs on essential goods.
Despite a 2% rise in global sales, Mattel’s first-quarter report highlighted the uncertainties stemming from volatile trade policies, leading the company to withhold a financial forecast. Kreiz noted that 40% to 50% of their products will still be priced at $20 or less, but ongoing trade tensions contributed to significant stock declines since early April.
Trump’s recent remarks at a Cabinet meeting suggested children could manage with fewer dolls, positioning tariffs as a potential source of wealth for the country. He dismissed concerns about product shortages and emphasized a reduced consumer choice in the toy market. The Toy Association reports that nearly 80% of toys sold in the U.S. are imported from China, advocating for zero reciprocal tariffs to maintain affordable toy accessibility.
Analysts highlight that substantial tariffs could lead to severe price increases, with toys possibly doubling in cost. Mattel only produces about 20% of its U.S. toys in China and is in the process of diversifying production locations, aiming for less than 10% of its output to come from China by 2027. Kreiz remarked that bringing manufacturing back to the U.S. is not a feasible option. Overall, the company prepares for challenges as it navigates the uncertain economic landscape and evolving trade policies.
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