Americans may have to kiss goodbye to Walmart’s ‘everyday low prices’ if President-elect Donald Trump’s proposed tariffs take effect, warns CFO

A new era of ‘reflation?’

The tariff talk has Wall Street buzzing with the word “reflation,” Politico reported, describing what could be an imminent period of newly rising prices, when households have barely recovered from the decades-high inflation they contended with through 2022 and 2023.

Government data shows the U.S. imported $3.8 trillion worth of goods in 2023. Among the most heavily imported categories, according to Trading Economics, were electronic equipment, machinery, cars and trucks, gas and diesel, and pharmaceutical products.

Many of these would likely be subject to the incoming Trump administration’s promised tariff regime.

And some industries may be more impacted than others. For example, the U.S. imports 40% of crude oil refined in the country, according to the American Fuel & Petrochemical Manufacturers. That oil becomes the petroleum that runs Americans’ cars, heats their homes and generates electricity.

Most of these imports came from Canada, and to a lesser extent Mexico, both of which are major U.S. trade partners and parties to the Canada-U.S.-Mexico Agreement, the successor to the North American Free Trade Agreement (NAFTA).

That deal was re-negotiated in a series of tense sessions during Trump’s first term — but not before the president ordered a 25% tariff on steel imports and 10% tariff on aluminum, including products coming from the country’s North American neighbors.

Both Canada and Mexico were eventually made exempt from tariffs, but now that Trump has signaled his intention to move quickly on a 25% tariff on their goods — unless they make changes to their border policies — that’s likely to end.

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Who ends up paying the cost

While Trump’s argument is that tariffs will benefit American businesses, some business leaders worry it won’t be helpful.

Following Trump’s imposition of the aluminum and steel tariffs in 2018, employment in the steel industry fell by 7,100 between 2019 and 2021 and only began to bounce back after the tariffs were replaced with a quota system.

And according to Tax Foundation estimates, Trump’s proposed tariffs could generate $1.2 trillion in tax revenue, however, at the same time, they could cost the country 344,900 jobs and reduce GDP by 0.4%.

But ultimately, those most likely to shoulder the cost of these tariffs are consumers — as studies have shown. In fact, WalMart’s Rainey isn’t the only U.S. business leader preparing people for increased prices under the proposed tariffs. Best Buy CEO Corrie Barry reportedly said electronics could get more expensive in a recent earnings call.

Barry told investors any added costs the company sees on imports from the three counties in question “will be shared by our customers,” adding that “there’s very little in [the] consumer electronics space that is not imported.” “These are goods that people need, and higher prices are not helpful,” she added.

Correction: An earlier version of this story incorrectly stated that the U.S. imported $3.1 billion worth of goods in 2023. MoneyWise regrets the error