Treasury Secretary Steven Mnuchin spoke with Walmart's CFO about sourcing products away from China
- Treasury Secretary Steven Mnuchin says he has spoken with a top Walmart executive about how it can keep prices low amid the U.S.-China spat.
- "I was on phone with the CFO of Walmart ... to specifically understand from Walmart what things they can source from other areas," Mnuchin said.
- When pressed by Rep. Cindy Axne, D-Iowa, whether Americans would be paying more as a result of tariffs, Mnuchin said he didn't "necessarily agree with that."
Treasury Secretary Steven Mnuchin testified on Capitol Hill on Wednesday that he has spoken with a top Walmart executive about how the retail giant can best position itself and keep prices low amid the growing trade war with China.
In response to a question from Rep. Ben McAdams, D-Utah, about proposed tariffs and potentially higher prices on items including diapers, infant formula and strollers, Mnuchin said he discussed such concerns with Walmart Chief Financial Officer Brett Biggs.
"I can tell you I am monitoring the situation very carefully. I was on phone with the CFO of Walmart, which obviously is one of the biggest sellers of the items that you've described to specifically understand from Walmart what things they can source from other areas and what items they can't," Mnuchin said at the House Financial Services Committee hearing.
"I would say we haven't made any decisions yet, but we will be especially sensitive to the consumer items," Mnuchin said.
Mnuchin added that he speaks with Biggs on a "regular basis" and has "spoken to all of the major companies that provide consumer goods" about the issue. Asked for comment, Walmart reiterated statements from its first-quarter earnings call made by Biggs and the chief executive of its U.S. arm, Greg Foran.
"In regards to tariffs, we continue to monitor the situation. Our goal is always to be the low price leader and we'll continue to actively manage pricing and margins with our customers and shareholders in mind," Biggs said Thursday. "We're going to continue to do everything we can to keep prices low, that's who we are. However, increased tariffs will lead to increased prices we believe for our customers."
Foran later added on the earnings call: "Merchants are managing costs and retails on an item by item basis. We are working closely with domestic and international suppliers to drive higher efficiency and reduce costs."
When pressed by Rep. Cindy Axne, D-Iowa, whether Americans would be paying more out of pocket as a result of the import taxes, Mnuchin said he didn't "necessarily agree with that and that's something we're monitoring very carefully."
"There may be a small number of items where the tariff may be passed on," he told Axne. "If we issue an exception, then there will be no price increase. And again, most of those companies are moving products to other places."
Retailers across the country have been on edge ever since President Donald Trump reignited trade tensions with China earlier this month. Though tariffs on $200 billion "List 3" Chinese goods increased to 25% from 10% earlier this month, Trump has said he's mulling slapping the last tranche of imports with tariffs as high as 25%.
That could increase the price importing companies pay on a variety on consumer goods ranging including soccer balls, children's picture books, and grand pianos. Congressional leaders, as well as Mnuchin, note that whether or not companies pass the higher bill on to consumers remains a priority in the months to come.
Correction: An earlier version gave the wrong first name for Walmart's Brett Biggs.