NEW YORK: Toy prices in the United States are poised to surge by as much as 50%, industry leaders warn, following President Donald Trump’s sweeping tariffs on imports from China and Vietnam — the two largest toy manufacturing hubs for American brands.
The announcement, which formed part of a broader trade crackdown unveiled this week, sent shockwaves through the toy industry and markets alike. Industry executives say the tariffs could drastically reshape pricing, production, and supply chain strategies — with everyday American families footing the bill.
“Everyone is really in scramble mode,” said Greg Ahearn, CEO of The Toy Association. “This is going to have massive negative repercussions for the consumer and for our industry.”
Major Manufacturing Hubs Hit with Hefty Duties
President Trump slapped China with an additional 34% duty, bringing the total tariff rate on Chinese goods to 54%. Vietnam, which many companies turned to in an effort to diversify amid previous U.S.-China trade tensions, was hit with a 46% tariff.
According to The Toy Association, 77% of toys imported into the U.S. come from China, with Vietnam ranking third after Mexico. But with Mexico already facing a 25% tariff on goods not compliant with the United States-Mexico-Canada Agreement (USMCA), the entire supply chain is now under pressure.
Toy Stocks Tank on Wall Street
The financial fallout was immediate:
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Mattel Inc. shares dropped 16.5%
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Hasbro Inc. fell more than 12%
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Funko Inc., which also relies heavily on Chinese and Vietnamese manufacturing, saw an 18% drop
Both Mattel and Hasbro had already accounted for a 20% China tariff impact in their 2025 financial projections. But as alternative sourcing countries like Indonesia (32%) and India (26%) were also targeted by tariffs, shifting production no longer offers cost relief.
“Relocating production may not be financially viable,” noted Eric Handler, analyst at Roth Capital Partners. “Consumers should soon see price increases to partially offset the tariff impact.”
Consumers to Feel the Pain
Toy companies typically operate with low profit margins, which limits their ability to absorb the additional costs. According to Ahearn, a 50% price increase is possible on certain toys, particularly those already operating on tight margins.
“There’s no place for the cost to go but to the consumer,” Ahearn explained. “The greatest budgetary impact, unfortunately, will be on the families who can afford it the least.”
The Toy Association expects the most noticeable price hikes to coincide with the upcoming back-to-school season, raising concerns for parents preparing for holiday shopping and fall birthdays.
Vietnam May Be More Open to Talks
While China announced a 34% retaliatory tariff on U.S. goods, manufacturers remain hopeful that Vietnam may be quicker to negotiate.
“Vietnam isn’t in a place where they can stand losing much of the business,” said Curtis McGill, co-founder of Hey Buddy Hey Pal, makers of the Eggmazing Egg Decorator. “We’re hoping for a faster resolution.”
Outlook Uncertain Ahead of Holiday Season
With tariffs set to take effect on April 9, toy companies are racing to reevaluate production contracts, redesign packaging, and manage costs wherever possible. Still, analysts say the likelihood of shielding U.S. consumers from price hikes is slim.
If no resolution is reached, 2025 could mark the most expensive year for toys in recent history, dramatically shifting consumer behavior and hurting low-income families the hardest.
