RTX expects up to $800 million in cost impacts from tariffs imposed on Canada, Mexico, China and other nations. It hasn’t included the potential impact in its earnings forecast.
“Generally speaking, the aerospace and defense sector has operated in a duty-free environment,” said President Christopher Calio, in a conference call with analysts. “And that has been instrumental to the industry maintaining one of the largest trade surpluses across American manufacturing industries for decades.”
GE Aerospace
The maker of jet engines and aviation systems is also accustomed to low trade barriers within the aviation sector. The company now expects tariff costs of roughly $500 million after hopefully mitigating some of the impact through programs and strategies, such as expanding foreign trade zones.
“We’ll continue to advocate for an approach that reestablishes zero-for-zero tariffs in the aviation sector and ensures a level playing field for the U.S. aerospace industry,” said CEO H. Lawrence Culp Jr., in a conference call with analysts. “In the meantime, heightened tariffs will result in additional costs for us and our supply chain.”
Flexsteel Industries
The furniture company could see much more damage from a mix of tariffs and a downturn in consumer spending.Flexsteel has moved out of China, but Vietnam supports about 55% of its revenue, while operations in Mexico support almost 40% of sales, the company said.
If the 46% reciprocal tariff rate on Vietnam, which is currently delayed, goes into effect, “it will have wide-reaching implications both on Flexsteel’s business and the overall U.S. furniture industry,” said President and CEO Derek Schmidt, in a conference call with analysts.Those wide-ranging impacts could include a weaker U.S. economy brought on by stunted consumer spending. The company expects sales between $109 million and $116 million during its current quarter, but that could change depending on shifts in tariffs and consumer demand.
Earnings reports and tariffs
Uncertainty over tariffs and an unpredictable trade war is weighing heavily on companies as they report their latest financial results and try to give investors financial forecasts. Some tariffs remain in place against key U.S. trading partners, but others have been postponed to give nations time to negotiate. The tariff and trade picture has been shifting for months, sometimes changing drastically on a daily basis. Those shifts make it difficult for companies and investors to make a reliable assessment of any impact to costs and sales.On Tuesday, Treasury Secretary Scott Bessent said he expects a “de-escalation” in the trade war between the U.S. and China, but cautioned that talks between the two sides had yet to formally start. Here’s how several big companies are dealing with the tariff confusion:
Tesla
Tesla is in a better position than most car companies to deal with tariffs because it makes most of its U.S. cars domestically. But it still sources materials from other nations and will face import taxes.The bigger impact will be seen in the company’s energy business. The company said the impact will be “outsized” because it sources LFP battery cells from China.
