Coca-Cola CEO James Quincey told CNBC on Wednesday the company is seeing cost pressures in part due to President Donald Trump‘s tariffs on steel and aluminum.
“We had to take with our bottling partners an increase [in prices] in our sparkling beverage industry in the middle of the year, which is relatively uncommon,” Quincey said on “Squawk on the Street” after Coke reported earnings. “That’s the metal steel and aluminum going up. The labor going up.”
The Trump administration has enacted steel and aluminum tariffs on numerous nations including allies Canada, Mexico and the European Union, which have launched retaliatory measures. That means higher prices, including on cans of soda.
Quincey told CNBC’s Sara Eisen that Coke and its partners are working on ways to grow the business in the new environment.
“The tariffs on the metals, it’s one of many factors [that] cost us to go out in the middle of the year and announce price increase,” he said.
Despite the impact, Quincey said Coke may have a slight advantage over other companies because is its products are made locally.
“We’re very focused on creating local businesses, with local factories, with local jobs, with local blue collar,” he said. “Less trade and more tariffs will mean less economic growth in the end and that will affect us.”
Coke reported better-than-expected second-quarter earnings and revenue Wednesday, bolstered by its efforts to bring its diet drinks around the world.
During the quarter, the company launched its dairy-free smoothie brand AdeZ in Europe and debuted Coca-Cola Stevia No Sugar in New Zealand. It also brought its revamped Diet Coke campaign to Britain, following its previous launch in the U.S.
—CNBC’s Lauren Hirsch contributed to this report.
Correction: An earlier version misstated the products Coke launched during the second quarter.
Be the first to comment