How Tesla and other companies deal with uncertainty in the trade war

New York (AP) – Uncertainty about definitions and Unpredictable commercial war It weighs heavily on companies, as they report their latest financial results and try to give investors financial expectations.

Some definitions are still valid against the main American commercial partners, but others have been postponed to give countries time to negotiate. The tariff and commercial image have turned for several months, and sometimes it changes dramatically on a daily basis. These transformations make it difficult for companies and investors to make a reliable evaluation of any effect on costs and sales.

On Tuesday, Treasury Secretary Scott Payet said he expected “escalation” in the trade war between the United States and China, but warned that the talks between the two sides did not start officially.

Here is how many major companies deal with the confusion of customs tariffs:

Chipotle

Chipotle Mexican Grill said on Wednesday that its costs are rising due to the definitions.

The Tex-MEX series said it gets some beef from Australia, packaging and packaging from Vietnam, Indonesia and Thailand. It is also the sources of avocado from Colombia and Peru. All are now subject to a 10 % tariff.

Adam Rimmer, the financial manager of Kibutle, said during a phone call with investors that the tariffs may also affect the cost of building new restaurants, because elements such as shelves and spare parts for equipment come from China. But Rimmer said that the impact of definitions on imports from China is difficult to predict. This week, Trump administration officials said they are Expect an “escalation” In the trade war between the United States and China.

Chipotle reported weaker revenues than expected from January to March and reduced its expectations for sales of the same stores for the whole year.

CEO Scott Buttaret said that concern about the economy was “the tremendous cause” consumers reduce their visits to Chipotel during the quarter. He said this trend continued until April.

Timing

Tesla is in a better position than most car companies to deal with customs tariffs because it makes most of its American cars locally. But they are still sources of material from other countries and will face import taxes.

The greatest effect We will see in the energy business in the company. The company said the effect will be “big” because it is the sources of LFP battery cells from China.

The broader trade war can hurt the company as China, the largest electric cars market in the world, has been forced to force Tesla in the United States earlier this month to stop taking orders from the main mainland customers for two models, its model and X.