American toy giant Mattel has announced plans to continue reducing the proportion of goods produced in China following the imposition of a 10% tariff on imports from China by the United States. The company aims to decrease the global production share of Chinese-made goods from 50% to below 40% this year.
During the fourth-quarter earnings call on February 4th, Mattel’s Chief Financial Officer Anthony DiSilvestro stated that by 2027, no single country’s share of global production is expected to exceed 25%.
The manufacturer of Barbie dolls and Fisher-Price toys mentioned that despite the additional tariffs imposed on imports from China, they anticipate ongoing profit growth in 2025 as the company diversifies its supply chain.
Mattel’s CEO Ynon Kreiz highlighted their continuous efforts since 2018 to enhance the global supply chain during the earnings call. As part of the 2024 “Optimizing Profit Growth Plan,” the toy maker shut down a tier-one supplier factory in China, saving $83 million for the company.
“This proactive strategy aims to achieve diversification and establish a geographically balanced supply chain infrastructure, enabling us to better respond to various potential changes,” Kreiz said.
Kreiz further emphasized that Mattel has turned supply chain reform into a competitive advantage, allowing the company to stand out among competitors in challenging market conditions.
He downplayed the connection between supply chain relocation and tariffs, stating, “It has nothing to do with any specific country, or even necessarily with tariffs. It is simply to ensure a flexible, adaptable, and diversified supply chain system.”
According to Mattel’s 10-K filing, the company sources its products primarily from seven countries, including Indonesia, Thailand, Malaysia, and Mexico. Although Mexico’s production share is less than 10%, the country may face a new round of tariffs from the United States in the coming weeks.
Furthermore, Mattel also plans to mitigate the impact of tariffs through measures such as price increases.