Study: Tariffs to cost companies $1.2T this year, mostly hitting consumers

• It also contributes to a picture of a much more difficult economy ahead.

Driving the news: In the study published on Thursday, S&P Global found that companies are now expected to pay at least $1.2 trillion more in 2025 expenses than they anticipated on Jan. 1, in what the researchers say is likely a conservative estimate.

• The researchers project that at least two-thirds of "expense shock" will be passed on to consumers, with the rest absorbed by companies.

By the numbers: The $1.2 trillion figure comes via data collected from 15,000 analysts across 9,000 companies.

What they're saying: "The sources of this trillion-dollar squeeze are broad," the researchers said in the report.

• "Tariffs and trade barriers act as taxes on supply chains and divert cash to governments; logistics delays and freight costs compound the effect," they wrote.
• "Collectively, these forces represent a systemic transfer of wealth from corporate profits to workers, suppliers, governments and infrastructure investors."

Zoom in: Trump's suspension of the "de minimis rule" this year increased the "squeeze" on companies, per the report.

• The rule, which meant that packages valued at less than $800 have enjoyed an exemption from added levies, allowed foreign online retailers like Temu and Shein to sell cheap items to American consumers.
• The suspension marked "a clear inflection in global trade costs."

The intrigue: AI lifted profit margins this year, the researchers noted, but tariffs "pulled them down."

Catch up quick: Trump has re-escalated trade tensions with China.

• The threats put imported cooking oil on the chopping block for consumers.
• The Yale Budget Lab estimated in August that Trump's latest tariffs will cost U.S. households $2,400 this year.