Trump Tariffs Drive Consumer Prices Higher Across U.S. as Brands Adjust Strategies

25 May 2025

Photo by Chip Somodevilla/Getty Images

President Donald Trump's latest tariff moves are sending ripples through the U.S. economy, with major retailers and manufacturers warning of increasing costs that are being passed on to consumers. The result? Higher prices on everything from groceries and toys to vehicles and smartphones.

Walmart, the largest retailer in the U.S., has confirmed it will raise prices on key categories, including household essentials, groceries, toys, and electronics. Despite public pressure from Trump to absorb the cost of tariffs themselves, Walmart executives argue that the scale of the tariffs makes it economically unfeasible. “Retailers can only take so much before they have to pass costs to shoppers,” said one company insider.

The tariffs, aimed largely at imported goods from China and other countries, were imposed as part of Trump's strategy to boost domestic manufacturing and reduce U.S. dependence on foreign imports. But economists say the result may be the opposite in the short term: American consumers facing an invisible tax.

Other major companies are following suit. Mattel, the maker of Barbie and Hot Wheels, has stated that while they aim to keep 40%–50% of their products under $20, tariffs are making that difficult. Rising production costs have already forced them to reprice several items ahead of the summer shopping season.

The auto industry, too, is feeling the squeeze. Subaru and Ford have both announced plans to raise prices on specific vehicle models, especially those assembled with parts sourced from abroad. With raw materials like steel and aluminum also facing tariffs, automakers say they’re left with few choices other than to increase sticker prices or cut features.

In the world of tech, Apple may face some of the stiffest challenges. Trump has proposed a 25% tariff on iPhones not produced in the United States. While Apple has diversified some manufacturing outside China to countries like India and Vietnam, it still heavily relies on Asian production lines. Experts warn that if these tariffs are enacted, iPhones in the U.S. could rise by as much as $200–$300 per unit. That would be a major hit, especially as new models are expected to launch later this year.

Footwear giants like Nike and Adidas are also revising their pricing outlooks. Both brands have voiced concerns in the past over tariffs, which they say disproportionately affect American families. “Tariffs are essentially hidden taxes on consumers,” Adidas stated in a recent earnings call.

Trump, however, defends the measures as a necessary correction to unfair trade practices and a means to bring jobs back to America. “Companies need to manufacture in the U.S. again. That’s the goal,” he said during a recent press conference.

Still, the reality for many households is this: higher costs at checkout. Whether buying a pair of sneakers, a new toy for a child, or a smartphone, American families are now bearing the brunt of the trade war.

With inflation already a concern and wages not keeping pace for many, retailers are bracing for possible consumer backlash. Some companies are exploring loyalty programs or absorbing part of the cost temporarily to maintain customer trust, but many industry experts say sustained tariffs will inevitably raise prices across the board.