By Jim Roberts
In recents weeks GM, Harley-Davidson, Whirlpool, Alcoa and other big industrial companies have issued weakened profits forecasts that all pointed to a common culprit -- Donald Trump’s tariffs.
But on Friday, Trump’s chief economic adviser Larry Kudlow tried flipping the script, blaming company executives for the weak performance of their businesses.
In comments to Cheddar’s Tim Stenovec on the White House lawn, he said, “I’m seeing some companies reporting weaker than expected earnings and blaming tariffs. And it’s not true.”
“There are some companies who came in below who chose to blame tariffs rather than their own lack of execution and management.”
Kudlow’s comments to Cheddar contrasted sharply with the earning statements of numerous companies that rely on imported steel and aluminum -- raw materials that have been subjected to a 25 percent tariff by President Trump.
GM, for instance, cut its earnings projection to $6 a share from an expected $6.50, because of surging costs of raw materials. In part because of tariffs, GM projected that its raw materials costs would double to $1 billion.
Harley-Davidson, the iconic U.S. motorcycle manufacturer, reported this week that operating profits would fall this week to 9.5 percent, compared to an earlier projection of 10 percent.
Also, this week, Whirlpool reported that surging raw materials costs would cost the company about $350 million in 2018. That’s at least $100 million more than the company was anticipating at the first of the year.
In his comments to Cheddar, Kudlow went on to label the executives he was referring to as “good folks.”
“Many of them are friends of mine,” he said.
“Stay tuned,” he added. “In the next six to 12 months I think you will see the president’s effort to reform trade bear a lot of fruit.”
“I believe his tough strategy is going to pay off.”