With Christmas approaching and President-Elect, Donald Trump, promising the introduction of greater trade tariffs, the toy manufacturing industry is rushing to move away from Chinese factories.
While news of greater tariffs under Trump has created more urgency, this isn’t a new issue. Toy giants such as Mattel and Hasbro have been working to diversify away from production in China for some time, relocating to factories in India and Vietnam. This has not been an easy process, and the result may be higher prices for consumers.
Trump spared toys, along with some other consumer goods, from tariffs during his first presidency, but it remains unclear whether they will be exempt the second time around. Most US industries have been seeking alternatives to China for some time, as the Biden administration left many Trump-era tariffs in place and introduced some new ones.
Hasbro is already partway through a $750m cost-cutting initiative, where moving away from China is just one piece of the puzzle. They are renegotiating with suppliers and altering their designs to make production easier. Even Jenga blocks are undergoing a manufacturing overhaul, which will see only one type of wood used.
Data from the US government’s Census Bureau shows that US imports of games, toys, and sports equipment were worth around £42bn in 2023, with approximately £32bn of that coming from China, underscoring China’s continued dominance in export markets despite some diversification efforts.
Sources: https://www.wsj.com/business/trump-tariffs-hasbro-toys-china-329ab211?mod=djemlogistics_h
If you have any questions or wish to explore your options, reach out to us. Our team of experts is ready to assist you. please don’t hesitate to contact us on 0333 241 3350 or email info@richmondhousewm.co.uk
The information available through Richmond House Wealth Management is for your general information. In particular, the information does not constitute any form of advice or recommendation and is not intended to be relied upon by users in making (or refraining from making) any investment decisions. Appropriate independent advice should be taken before making any such decision. Past performance is not necessarily a guide to future performance. The value of investments may go down as well as up and you may not get back the money you originally invested.
Richmond House Wealth Management is a trading name of IWP Financial Planning Limited which is authorised and regulated by the Financial Conduct Authority. Financial Services Register:441359 at register.fca.org.uk. Registered Office: Blythe Lea Barn Mill Farm, Packington Park, Meriden, Warwickshire, CV7 7HE. Company Number 04138186.