The moment has arrived: President Trump's tariffs on steel and aluminum are beginning to impact beverage costs. Coca-Cola announced it's raising soda prices on Thursday, and while it's unclear how much the move will impact the price tag on a can of Coke, it seems likely that consumers will soon be forced to pay extra for their bubbly fix.
Coca-Cola CEO James Quincey told investors and journalists that the company is being forced to raise prices because of Trump's tariffs, as well as the rising costs of transportation and labor. BuzzFeed News reports that this is the first instance of a price hike in the beverage industry as a result of Trump's steel and aluminum tariffs.
"We had to take with our bottling partners [... a price] increase in our sparkling beverage industry in the middle of the year, which is relatively uncommon," Quincey told CNBC. He described the tariffs as "one of many factors" that was forcing the company's hand.
If you're anything like the average American who consumes 92 Coke products every year (according to a company presentation obtained by Business Insider), you're probably wondering exactly how much more money you're going to have to fork over to get your desired can of Coke, Sprite, or any of the other sodas under the Coca-Cola brand.
But we don't yet know how much this is going to affect consumers, because it's the retailer who picks the price tag to slap on a can. Of course, it stands to reason that retailers will likely increase prices if the soda itself has gotten more expensive.
Can makers have been warning as much since the tariffs were announced. Robert Budway, the president of the Can Manfacturers Institute, told MarketWatch in March that the tariffs would "put food and beverage cans at a disadvantage among competitive packages, such as plastic and glass, which are not subject to tariffs." He added: "This would ultimately harm U.S. consumers, who would pay more for canned food and beverage products."
Not everyone is convinced that an intense hike in the price of Coke products is coming. Lisa Reisman, MetalMiner's executive editor, told MarketWatch, "I think your average guy isn't going to notice." She added: "If you notice it, congratulations."
The Trump administration has also claimed that consumers will not be overly hurt by the tariffs. Commerce Secretary Wilbur Ross has implied that the price increase on Coke will be similar to that of Campbell's soup, which he claims will go up only by "six-tenths of one cent."
It would be wrong to suggest that Coca-Cola is struggling in the wake of Trump's tariffs. The company earned $360 million more than expected last quarter and also just got a huge windfall from the GOP tax break (which the company has said it will largely give to shareholders; it's also said that it isn't interested in raising its employees' wages across the board).
Whether or not the company could assume the new costs from the tariffs instead of passing them on to consumers, it's made it clear that it isn't going to do so. Buckle up, Coke-drinkers: You may need an extra bit of change on you next time you shop for that can.