Newell Brands Relocates Production Amid Tariff Uncertainties

Newell Brands, the maker of Sharpie pens, is moving its kitchen appliance production out of China and relocating its writing business manufacturing to Tennessee. CEO Chris Peterson cited tariff uncertainties ahead of the U.S. presidential election as the reason. Newell is also automating U.S. plants to manage higher wages.

Newell Brands, the iconic maker of Sharpie pens, is shifting its kitchen appliance production out of China, while relocating its writing business manufacturing to Tennessee. CEO Chris Peterson attributes these moves to uncertainties surrounding tariffs ahead of the U.S. presidential election, as reported in an exclusive interview with Reuters.

Peterson clarified that these supply-chain changes are not influenced by Republican candidate Donald Trump's pledge to increase tariffs on Chinese goods. However, he acknowledged that the company seeks to minimize exposure to potential tariff hikes, regardless of the election outcome.

Newell's automation efforts in the United States aim to offset higher labor costs. The American-based factory can be expanded, reducing the company's dependence on volatile freight costs and production delays. Newell has also been transferring some kitchen appliance manufacturing to Vietnam, Thailand, and Indonesia.

The company, which acquired Jarden Corp in a $16 billion deal in 2016, is enduring financial struggles and aims to cut its dependence on Chinese manufacturing to under 10% by next year. Despite current challenges, Peterson remains focused on repatriating jobs and boosting wages by transitioning the workforce to more skilled labor roles.