Members of the Walton family (L-R) Rob, Alice and Jim speak during the annual Walmart shareholders meeting event on June 1, 2018 in Fayetteville, Arkansas. Photo by AFP
The combined net worth of the heirs of the Walmart fortune slipped $1.6 billion Friday after the company announced plans to raise prices to mitigate the effect of U.S.’ tariffs on China.
The wealth of Rob Walton, the eldest son of Walmart founder Sam Walton, dropped by $450 million, according to Forbes.
The 80-year-old remained the richest in the family with a net worth of $114.5 billion.
His brother Jim’s net worth fell $448 million, and his sister Alice saw her wealth declining by $439 million.
Two other family members lost $261 million on the day.
The decline came after CEO Doug McMillon announced plans to raise retail prices later this month due to the high cost of tariffs, in a clear signal that U.S. President Donald Trump’s trade war is filtering through to the American economy, according to Reuters.
Shares of Walmart, the world’s biggest retailer, were flat in afternoon trading, recouping most of its early losses of 4% in morning trading after it also declined to provide a profit forecast for the second quarter, even as the company’s U.S. comparable sales surpassed expectations in the first quarter.
“All of the tariffs create cost pressure for us, but the larger tariffs on China have the biggest impact. The cost pressure from all the tariff-impacted markets started in late April and it accelerated in May,” CEO Doug McMillon said in a meeting.
Although the U.S. and China have agreed to a 90-day reprieve that lowered duties on Chinese imports to 30%, Walmart still expects to see rising costs as it sources the majority of its goods from China.
“We will do our best to keep our prices as low as possible. But given the magnitude of the tariffs, even at the reduced levels announced this week, we aren’t able to absorb all the pressure, given the reality of narrow retail margins,” he added.
As of last year, around 60% of Walmart’s imported goods came from China. It is the largest importer of container goods in the U.S. with 870,000 containers received last year.
