As trade tensions escalate, corporate giants McDonald’s and General Motors, two of America’s most recognizable companies, are suffering the consequences. In his second term as president, Trump’s escalating global tariff war has pronounced economic impacts on the country’s most iconic businesses. These corporations argue that primary tariffs on China, Mexico, and European countries, in addition to new restrictions, are exacerbating the condition. The added restrictions, in their opinion, are raising competition challenges the companies face in the long run by inflating supply costs, disrupting services, and endangering global operations.
Part of Trump’s “America First Trade Initiative” is a 25% fee placed on the importation of food packaging substances and auto parts. The set of additional tariffs claimed by Trump aims at reversing the American trade deficit and enticing companies to establish production facilities on US soil. Yet, major business corporations in the US are increasingly being hurt by the policy.
At the latest round, McDonald’s was the first to express panic, shifting their burden onto consumers. In a quarterly earnings call this week, the CFO, Sarah Thompson, noted the impact increased costs between washing containers and imported beef goods freezer options have on the profit margin marginally.
“We’re dynamically adopting a new strategy toward input costs in Asia and Latin America,” quoted Thompson. “These costs cannot be controlled internally. At some point in this never-ending journey, different stakeholders will realize the impact.”
The undeterred fast food heyday operator, owning over 14,000 fast food outlets in the USA, seriously depends on international suppliers for resources like paper wrappers, cardboard boxes, and some processed food ingredients. Double Digit Loss McDonald’s warned that, as long as these BBB-rated tariffs are maintained throughout summer, there is an inevitability of 5-8% primary menu price hikes.
Apart from these macroeconomic forces, franchise owners working on ‘shredded glass‘ margin headlines also reveal deeper worries concerning shrinking profits and infrastructural expense enforcments – compliance retrofit retooling, relationship remodeling, compliance for domestic vendors.
GM: Agricultural Policies Hurt American Industry. “We aim to take action.”
These statements were uniformly noted by GM: “The tariffs for United States Steel… weaken American value.” Further emphasizing the Lost Revenue Potential of the Industry with the Elderly Shizz increasing our domestic produced vehicles consumption, assortment, and unfamiliar driving economics, older people prefer.
“These trade barriers are, in effect, a tax on American-made cars,” wrote Barra. “They reduce the ability to compete on price in foreign markets and degrade employment opportunities in America.”
The largest U.S. automaker, GM, has reported a 7% decline in global vehicle exports for the first quarter of 2025. The company says this decrease is a consequence of European and Chinese retaliatory tariffs. Additionally, the automaker warned that the persistent trade disputes threaten billions earmarked for investment in electric vehicles (EVs), specifically concerning the battery supply chain deal with Canada’s LG Energy Solution.
Tariff War Heats Up
President Trump, on the other hand, has not budged. At an Ohio rally this week, he defended his trade policy by saying it is “way overdue for America!” calling the U.S. economy “stronger than ever.”
“I stand corrected, we’re taking the heat from China, Europe, and the globalists who had the best of us for years,” Trump added. “Friendly reminder that businesses like GM and McDonald’s should do more to put American products instead of complaining.”
But analysts say this rhetoric is out of touch with the realities of sophisticated global supply chains. There are not enough, or affordable, American-made components and ingredients produced at scale, they point out.
General Discontent Across Various Industries
The discontentment faced by McDonald’s and GM is something that several other corporations also embrace. The relayed thoughts by the US Chamber of Commerce alongside the National Association of Manufacturers further highlighted the concern. Their reports showed that the dispute was widespread across US businesses regardless of domain. Supply chains were being impacted due to rising costs, delays, and foreign retaliation.
“Business operations in the US are becoming costly for every sector. Growing tariffs are just as good as taxes, and they severely restrict any type of business relief, especially regarding inflation and general global economic health.”
Supporting the claim of Monica Young, Senior Economist for the Brookings Institution, Trump’s ambition to increase domestic production was sharply contradicted by the recent findings from the US Commerce Department. They showcased a 3.1% drop in investment related to manufacturing during the past two quarters.
Working Class Citizens will be Paying the Price
Fueling this issue is the aggressive trade standoff, which experts are warning could widen the gap in affordable access for low-earning Americans looking to purchase the manufactured goods. Average working-class citizens have already started facing inflated prices on electronics, cars, and even basic food like burgers. The recent findings from consumer confidence surveys only worsened the scenario as 60% expressed alarmingly worrying voting trends, finding surging prices in 2025 highly likely.
Raising these expenses further could greatly lessen the purchasing power for transport-reliant low-income families, the worst. Based on these scenarios, it can be expected that those with no reliance on public transport will suffer most.
“Economist Rachel Lin at the Economic Policy Institute put it succinctly: ‘When McDonald’s has to charge $8 for a value meal, or when GM has to raise the price of a Chevy by $2,000, that’s a regressive burden. ’”
Foreign Retaliation Hurting Exports
At the same time, critical U.S. trade partners are retaliating. The European Union placed additional tariffs on American whiskey, denim, and motorcycles. China has retaliated with duties on soybeans, pork, and EV components—attacking the core of Trump’s rural and industrial stronghold.
As a consequence, these policies have led to a 5.6% decrease in U.S. exports for the first quarter of 2025, as reported by the U.S. Census Bureau. The agricultural industry in the Midwest has suffered greatly, with numerous farmers expressing anger about the loss international market.
Political Risks for Trump
While these policies, albeit unpopular among some factions of Trump’s entourage, do pose a risk as they start impacting everyday expenses and employment opportunities. Unions for autoworkers, factory workers, and even fast-food workers have voiced concerns regarding revenue losses and increased costs, leading to job cuts.
“We support American industry, but not if it means job cuts, inflation, and isolation,” said UAW (United Auto Workers) representative Marcus Rivers.
This is likely to be a sore issue in the 2026 midterm elections, especially across battleground areas that GM operates in.
What happens next?
No formal negotiations have been resumed, although there seems to be some informal negotiation between US and Chinese trade officials. Analysts believe that if the current administration continues on this path, the US may be stuck in a trade decoupling with China alongside permanently weakened ties with Europe.
For now, McDonald‘s and GM are drawing up contingency blueprints that include laying off workers if the hostile environment does not change, scaling back foreign investment, and diversifying suppliers.
Table of Contents
Conclusion
Trump’s tariff wars are impacting American businesses, as evidenced by the statement from McDonald’s and GM. Put simply, these corporations are warning us that operational politics are no longer confined to the realms of theoretical governance. The White House needs to accept that the harms of economy-strangling supply chains and inflation, in turn, the cost of services, alongside a breach with international partners, are worse than anticipated.
It is yet unclear if the administration is looking to make an adjustment on its route, or increase the risk even further on what is already a volatile track—this is the direction the world is watching take.
