Coca-Cola (KO) Raises Soda Prices As Trade War Tensions Heat Up

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Coca-Cola (NYSE:KO) announced on Friday that the company would be increasing soda prices due to the trade war tensions affecting any industry that uses steel.

soda pricesThe company relies on aluminum for its soda cans, which will now be harder to manufacture at a low price due to the recently imposed steel import tariffs from the Trump administration. The beverage maker said that it is upping the prices of its carbonated beverages due to the 10% tariff on imported aluminum, forcing the company’s hand.

Coca-Cola CEO James Quincey said on the company’s earnings call on Wednesday that the price increase was “disruptive,” but it had no choice but to enact it. “Obviously, while [customers] may understand the cost pressures that are out there on freight, on the increases in steel and aluminum and other input costs that affect the bottling system and affects some of our finished products, clearly, these conversations are difficult,” he said on the call.

A company spokesperson said that the extent of the price hikes will depend on how highly retailers want to increase the prices of cans as it is up to stores to choose whether or not they raise prices for consumers.

“”Also, note that increases are at the customer level,” they said. “Customers have discretion in what consumers are charged on the shelf”

KO stock fell about 0.2% following the news on Friday.


Article printed from InvestorPlace Media, https://investorplace.com/2018/07/soda-prices-ko-stock/.

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