Toy Industry Reels As Trump Targets Mattel

The American toy industry faces unprecedented challenges as President Donald Trump threatens Mattel with punitive 100% tariffs, potentially transforming a trade dispute into a landmark battle between the White House and a major U.S. corporation over global manufacturing practices.

The confrontation escalated Thursday after Mattel CEO Ynon Kreiz warned that the administration’s aggressive trade policies would inevitably lead to higher toy prices for American consumers, statements Trump characterized as negotiation tactics during a charged White House briefing.

Singling Out an American Icon

Trump’s specific targeting of El Segundo-based Mattel marks a significant shift in his approach to tariff enforcement. “That’s ok. Let him go, and we’ll put a 100 percent tariff on his toy, and he won’t sell one toy in the United States, and that’s their biggest market,” Trump stated, according to The Daily Beast.

The president apparently mistook Mattel for a country during his remarks before correcting himself, highlighting the often improvisational nature of his economic policy announcements. Industry analysts note this appears to be the first time Trump has threatened to impose targeted punitive tariffs against a specific American company rather than a foreign nation.

Industry-Wide Transformation

Mattel has been working to reduce its manufacturing presence in China, with company representatives noting that Chinese production now represents less than 25% of their global manufacturing footprint, compared to an industry average of approximately 80%. “By the end of the year, less than 40% of Mattel’s product will be sourced from China, with a goal of reducing that to below 25% in the next two years,” according to CNBC.

The company has announced plans to relocate production of approximately 500 toys from Chinese facilities to manufacturing sites in other countries this year, though notably not to the United States. Kreiz has stated that even with tariffs, it remains more economical to manufacture toys outside America.

Market Impact and Investor Concerns

Mattel’s stock has plummeted more than 27% since Trump announced his “reciprocal tariff” policy last week, while rival Hasbro has seen a decline exceeding 20%, according to Road & Track. Bank of America estimates that both companies source approximately 40% of their U.S. products from China, making them particularly vulnerable to the current 145% tariff rate.

Pricing changes are already evident at retail, with a Telsey Advisory Group analysis finding that a Barbie doll with swimsuit sold at Target rose 42.9% over a single week in mid-April to $14.99—one of the largest price jumps tracked by the research firm. Industry analysts project further price increases across toy categories as companies attempt to absorb or pass along tariff costs.

Consumer Protection vs. Economic Nationalism

The escalating dispute centers on the administration’s insistence that manufacturing can and should return to American soil, versus industry assertions that such relocations are economically unviable. “We believe that production in other countries where we can be efficient and more productive is the best balance between manufacturing outside of the U.S. and continuing to develop product in terms of design and creativity in America,” Kreiz told Fox Business.

The Toy Association continues advocating for zero tariffs on toys to ensure accessibility, noting that approximately 40-50% of Mattel’s products currently retail for under $20—a price point critical for middle and lower-income families. Critics of this strategy argue that lower prices come at the cost of American manufacturing jobs.

Broader Trade War Implications

Trump has made toys a focal point of his revamped trade policy, suggesting last week on “Meet The Press” that American children could make do with fewer toys. “I don’t think that a beautiful baby girl needs—that’s 11 years old—needs to have 30 dolls. I think they can have three dolls or four dolls,” the president stated.

As U.S.-China trade talks continue in Switzerland, industry representatives warn that consumers will ultimately bear the cost of this economic nationalism. Jay Foreman, CEO of Basic Fun!, told NPR: “Parents will always find something for their child…But how about all the moms and dads who work for those companies…they might not have a business, they might not have a job.”