Trump toy tariffs threaten US holiday season with empty shelves and soaring prices

American toy retailers brace for massive cost hikes and shipment delays as Trump's China tariffs hit 145 percent.

Boxes filled with Duncan toys are stacked inside the company’s warehouse in Columbus, Indiana, on April 16, 2025. While all products are designed and developed in the United States, most are manufactured in China, according to Josh Staph, chief executive of Duncan Toys Company. Photo by Leandro Lozada/AFP

By Anna Fadiah and Hayu Andini

President Donald Trump’s sweeping tariffs on Chinese goods have sent shockwaves through the American toy industry, a $40 billion sector that depends heavily on China-based production. With import taxes now reaching as high as 145 percent, industry leaders warn that the U.S. holiday season could be marred by toy shortages, delayed shipments, and significantly higher prices for consumers. The impact of these Trump toy tariffs is already rippling across retailers and manufacturers alike, many of whom say they are grappling with uncertainty and logistical chaos.

Josh Staph, CEO of Duncan Toys Company, described the situation as dire. “Things have ground to a halt,” he said, explaining that the new duties imposed by the Trump administration forced his company to stop shipping goods into the U.S. entirely. Duncan Toys, based in Indiana, designs and develops its products domestically but relies on Chinese factories to manufacture nearly all of them — from yo-yos to flying discs and model gliders.

Tariffs disrupt industry just 100 days into Trump’s return

Just under 100 days into President Trump’s return to the White House, the toy industry finds itself scrambling to navigate volatile trade policy changes. Staph noted that after the Trump toy tariffs were imposed, the cost of importing products from China more than doubled. “We stopped shipping goods into the U.S. because of the 145 percent tariff,” he said.

The numbers speak for themselves: of the $17 billion worth of toys imported to the United States last year, over $13 billion came from China. These toys now face import taxes that have soared from zero to 145 percent under Trump’s renewed trade war with Beijing.

The additional costs are wreaking havoc on pricing strategies and inventory planning. “As a business leader, the most challenging part is the uncertainty,” said Staph. “It’s tough to build any sort of strategy and go for a plan when we know that things are changing almost on a daily basis.”

Retailers fear price spikes, shipment delays

Retailers across the country are also bracing for a rough ride. Rita Pin Ahrens, who owns three toy stores including one in Washington, said she began seeing tariff surcharges of 15 to 25 percent in March — with projections that they will climb to the full 145 percent by summer. “It has been a complete nightmare,” she said. “I am really, truly worried about whether we can actually sustain the store.”

Many of the toys she sells are either made entirely in China or assembled there with key components. Like other retailers, she’s trying to minimize the cost burden for customers. That has meant delaying new purchases, canceling overpriced orders, and rushing to stock up before new tariffs take effect.

But even these mitigation efforts have limits. Shipments are already experiencing delays, and with the holiday season approaching, retailers worry that shelves will remain unstocked during the busiest shopping time of the year.

US toy production can't fill the gap

Greg Ahearn, CEO of The Toy Association, emphasized the long-standing dependence of the American toy industry on Chinese manufacturing. “Production of toys has all but stopped in China,” he said, noting that small U.S. brands are now struggling with sudden and enormous tariff payments for containers that were manufactured before the new policies were announced.

Many toy companies lack the cash flow to adapt quickly. “Most of these are small businesses with very limited working capital,” Ahearn explained. He also warned that American manufacturing cannot fill the gap left by disrupted Chinese imports anytime soon.

While some toys are still made in the U.S., most require intricate, hand-assembled parts or complex processes like injection molding — systems that take years to build or relocate. “The injection molding equipment is massive and immobile,” Ahearn said. “It’s not something you just pick up and move.”

Christmas at risk as retailers warn of ‘empty shelves’

If the Trump toy tariffs remain in place, the consequences could be visible to American families by December. “If this isn’t cleared up in 30 to 60 days, it’s going to be a really difficult Christmas season,” Staph warned. “We could be looking at empty shelves in a lot of major retailers like Target and Walmart.”

That prediction is alarming for a retail sector that relies heavily on fourth-quarter sales. About 90 percent of holiday toy stock comes from overseas, most of it arriving during the summer months for fall distribution.

Even when products do make it through the supply chain, they’re unlikely to be affordable. “The pricing of those toys that are even available will probably be twice, if not more, the price they were last year,” Ahearn said.

Industry appeals for exemptions as Trump targets sectors

The Trump administration initially introduced a 10 percent tariff on Chinese imports in February, citing concerns about China’s role in the fentanyl trade. But that levy soon jumped to 20 percent in March and then surged to 145 percent in April, catching many businesses off guard.

Industry leaders are now lobbying for exemptions. Staph hopes the government will recognize toys as essential products that should be shielded from trade policy disputes. He pointed out that during Trump’s first term, toys were specifically excluded from tariff lists — a precedent he believes the White House should follow again.

“Toys are important for children's development,” Ahrens said. “I really urge the president to do that again.”

Rising pressure from all sides

The pressure is growing from multiple directions. Retailers, manufacturers, and consumers alike are confronting the real-world impact of Trump’s latest protectionist measures. While the administration has emphasized national security concerns in targeting specific industries, critics argue that the toy sector poses no strategic threat and serves a vital role in early childhood development and education.

For now, uncertainty continues to cloud the outlook. Some industry players are exploring alternative production sites outside China, such as Vietnam or Mexico, but such transitions take time and significant investment. Others are taking a wait-and-see approach, hoping that trade tensions ease before the holiday season enters full swing.

Until then, businesses like Duncan Toys are bracing for continued turbulence. “It’s a very frustrating situation,” Staph said. “We just want to do what we’ve always done — make great toys that bring joy to kids everywhere. But right now, we’re being priced out of our own market.”

The Trump toy tariffs have changed the landscape dramatically. Whether the industry can bounce back before the year’s end remains uncertain. What is clear, however, is that the stakes are higher than ever — not just for toy companies, but for the millions of American families counting on an affordable and joyful holiday season.