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Factbox: Impact of U.S.-China trade tariffs on U.S. companies

Published 07/30/2018, 02:33 PM
© Reuters. FILE PHOTO: The General Electric logo is pictured on working helmets in Montoir-de-Bretagne
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(Reuters) - U.S. companies are putting in place measures to cushion the impact of escalating trade tensions between the United States and China.

The world's two largest economies have already imposed tariffs on $34 billion worth of each other's imports.

In his latest threat to the Asian nation, U.S. President Donald Trump has said he was ready to impose tariffs on all $500 billion worth of Chinese imports.

The following is a list of recent comments made by U.S. companies:

- Caterpillar Inc (N:CAT) said U.S. tariffs on Chinese imports are expected to increase its material costs by about $100 million to $200 million in the second half of the year. The heavy machinery maker plans to offset most of the higher costs with mid-year price hikes.

- General Electric Co (N:GE) estimated that new tariffs on its imports from China could raise its costs by $300 million to $400 million overall, before steps to lessen the impact.

- Detroit automakers General Motors Co (N:GM), Ford Motor Co (N:F) and Fiat Chrysler Automobiles NV (MI:FCHA) (N:FCAU) lowered their full-year profit forecasts due to escalating tariffs.

- Boeing Co (N:BA) is concerned about the impact of possible trade tariffs on the cost of running its supply chain, but has not yet seen any impact from U.S.-Chinese trade tensions on its business, Chief Executive Officer Dennis Muilenburg said.

- U.S. industrial conglomerate Honeywell International Inc (N:HON) said it would increase the use of supply chain sources from non-China countries to counter growing costs related to a tariff war between the world's two largest economies.

- Home furnishings chain At Home Group Inc (N:HOME) said it would make adjustments to its supply chain to mitigate the impact of the proposed tariffs on goods imported from China.

- Home furnishing retailer Pier 1 Imports (N:PIR) says the company does not expect financial results in fiscal 2019 to be materially affected by proposed tariffs. About 59 percent of the company's fiscal 2019 net sales are expected to be derived from merchandise produced in China.

Of the 59 percent of 2019 sales from Chinese merchandise, about half is expected to have products subject to proposed tariff.

- U.S. motorcycle maker Harley-Davidson Inc (N:HOG) said it expected incremental costs of about $15 million to $20 million for the remainder of the year from the steel and aluminum tariffs imposed by Trump. It also says it will take further hits from retaliatory moves from the European Union.

- Polaris Industries Inc (N:PII), which makes Indian motorcycles, raised its 2018 cost estimates related to tariffs to $40 million from $7 million, and said it expected to ramp up motorcycle production in Poland for European market in 2019 to offset higher costs.

- Diversified industrial manufacturer 3M Co (N:MMM) said it expects an impact of about $10 million, or 1 cent per share, on an annualized basis from the tariffs passed so far. The company also said it was prepared to make changes to supply, sourcing and pricing in response to any further tariffs.

- Paper and packaging company International Paper (N:IP) Chief Executive Officer Mark Sutton says the company has so far not had any direct impact from tariff disputes.

- Otis elevator maker United Technologies Corp (N:UTX) said based on tariffs which have been enacted so far it expects to see 5 cent per share impact in 2018. The company expects to see a much bigger impact in 2019.

- Medical device maker Boston Scientific (N:BSX) said it buys a "very small portion" of components from China and that it has the ability to substitute with other suppliers outside of China since it does not manufacture in the country. - Upscale home furnishing chain RH (N:RH) expects to reduce significantly the amount of goods sourced from China in its 2019 fiscal year to mitigate the impact of proposed new tariffs by the United States.

- Gentex Corp (O:GNTX), a maker of aircraft windows and rear-view mirrors, said it expected cost increases of between $5 million and $8 million for the second half of 2018 related to its planned purchases of raw materials from China.

- Meat Processor Tyson Foods Inc (N:TSN) cut its full-year profit forecast, citing the uncertainty in trade policies and increased tariffs that have hurt domestic and export prices of meat.

- Toymaker Hasbro Inc (O:HAS) said it was moving more production out of China as a result of the tariffs, adding 30 percent of its manufacturing was now done elsewhere.

- Danaher Corp (N:DHR), which develops technology for the dental, life sciences, diagnostics and environmental industries, said it expected an earnings impact of 1 cent per quarter, and that it would look to modify manufacturing locations.

© Reuters. FILE PHOTO: The General Electric logo is pictured on working helmets in Montoir-de-Bretagne

- U.S. pipeline operator Plains All American Pipeline (N:PAA) said the tariffs were tolerable for the company, but it applied for exemptions. However, the company added that if it could not get the exemption or the required quota of steel, "it would just basically extend and delay growth."

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