On April 3, 2025, President Donald Trump escalated his trade war, imposing a 10% baseline tariff on most countries and significantly steeper levies on China and Vietnam. China was hit with an additional 34% duty, bringing the total tax on goods from the nation to 54%, while Vietnam faced a 46% tariff. Mexico was also subjected to a 25% tariff.
The toy industry, heavily reliant on supply chains in China, which accounts for approximately 77% of U.S. toy imports, is expected to face massive price hikes. Mattel shares fell more than 16.5% on April 3, 2025, and hit a new 52-week intraday low of $13.95 by April 11, 2025, down 27% since the tariffs were announced.
Mattel has been proactively diversifying its manufacturing footprint, with China expected to represent less than 40% of its global toy production in 2025 and U.S. imports from China targeted to fall below 10% by 2027. Despite these mitigating actions, the company indicated it would consider price increases to offset higher input costs, with China retaliating with its own 125% levy on American goods.
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