The first line of defense against tariff-induced price hikes? Big box retailers.

So far, they’re holding firm. As import levies begin to impact the price of, well, just about everything, Walmart and Target are going to war with suppliers over who must eat the added costs, Reuters reported Monday.

The Negotiating Table

Setting prices is a contact sport for retailers, and companies have been warning all year that things would get a little rough. But almost no one outdoes Walmart and Target at limiting sticker shock by squeezing suppliers. Target Chief Commercial Officer Rick Gomez said earlier this month that the company will look to increase the prices of certain goods to protect the price on items it deems critical or where customers are most likely to notice a bump, such as its line of $5 T-shirts.

Walmart Chief Financial Officer John David Rainey, meanwhile, outlined the company’s game plan to CNBC earlier this month: “We’ll work with suppliers. We’ll lean into our private brand. We’ll shift supply where necessary to try to take advantage of lower costs that we can then pass on to consumers.”

That’s good for consumers, and something of a nightmare for producers of consumer goods. So far, the tariffs have created a class of winners and losers at the retail price-setting negotiating table:

• On the winners’ side: providers of niche goods, who don’t have to compete against peer prices while negotiating for big box retail shelf space.
• On the losers’ side: everyone else. “There’s so much loss-leading going on out there,” Fraser Townley, chief executive of T2M, which creates niche video game controllers for mobile devices, told Reuters. Townley said he was able to negotiate new prices easily due to lack of competition, “but if you were one of 100 TV manufacturers trying to get your TVs into Walmart, they would say, ‘I have 99 others who don’t want to put prices up.’”

“The retailers will have to eat a little bit, the manufacturers are going to have to eat a little bit,” JPMorgan analyst Chris Horvers recently told CNBC, saying both parties want to avoid hiking prices on increasingly nervous shoppers. Just how anxious consumers are over tariffs will be made clearer today, when the US Conference Board releases its latest consumer confidence survey.

Trade Apocalypse Now: The trade war may only get more destructive: A new proposal from the Office of the US Trade Representative (USTR) would impose additional levies as high as $3 million on Chinese ships docking in US ports. The idea is to revive the US shipbuilding industry, which last year produced just 0.01% of new cargo ships in the world, according to the USTR, while China makes about half of the world’s cargo ships. In a two-day hearing with the USTR that began Monday, industry players warned the levies could devastate US trade, especially through smaller ports in the US, such as Oakland, Calif., or Charleston, S.C. “If you wanted to take a sledgehammer to trade, this is what you would do,” maritime transportation industry veteran John McCown told Bloomberg. “You take it all together — it’s like an apocalypse for trade.”

Recent electric vehicle sales data had already bruised Tesla, showing lower shipments in Europe, Australia, and China.

Then, on Monday, new data exposed an even wider world of pain: China’s EV leader BYD announced it topped $100 billion in annual sales last year, something Tesla has never achieved. And EVs by German rival Volkswagen outsold the Elon Musk-led firm on the Old Continent.

Electric Slide

BYD’s aggressive international ambitions have set off alarm bells among the western auto manufacturers and governments whose markets it views as the next frontier. Last fall, the EU slapped steep tariffs on Chinese carmakers — 17% for BYD, 18.8% for Geely and 35.3% for SAIC — after concluding they were distorting the market because Beijing’s subsidies allowed them to undercut competitors. The three firms are challenging the levies in European court.

In the meantime, expansion is undeterred. Last month, BYD raised $5.6 billion to fund its growth abroad, with new factories opened in Thailand and Uzbekistan last summer already helping the cause. In the first two months of this year, 16% of all car exports from China came from BYD and, last year, the automaker shipped more than 400,000 vehicles abroad, about 10% of the roughly 4 million cars it sold.

BYD also develops tech — large-scale lithium energy storage batteries, solar modules, and as of last week, a battery system that it claims can charge an EV in five minutes — which has accelerated concerns that it could undercut Tesla and legacy carmakers including Toyota and Volkswagen:

• On Monday, the Shenzhen-based company said revenue rose 29% last year to $107 billion, besting forecasts. Net income climbed 34% to $5.5 billion. BYD’s car sales in the fourth quarter totalled $28.8 billion, besting Tesla — which made $22.6 billion — for the first time.
• Austin, Texas-headquartered Tesla reported revenue of $98 billion in 2024, although it only sells fully electric vehicles while BYD sells hybrids, which remain popular in the Chinese market. However, retail investors have poured into Tesla stock hoping for a value buy — JPMorgan data shows $7.3 billion in inflows in the past two weeks, and Tesla rose 11% Monday.

All those buying the dip should be prepared to strap in, as Tesla is expected to announce its latest delivery figures next week — Goldman Sachs recently trimmed its quarterly target by 50,000 to 375,000 cars, suggesting shipments will fall more than 3% from Q1 2024.

EuroTrip Up: Last month, Tesla sold fewer than 16,000 vehicles in 25 EU countries, the UK, Norway and Switzerland, a 44% drop from February 2024, according to data compiled by Jato Dynamics researchers. Its market share, 18.4% last year, has fallen to 7.7% this year. In the meantime, Volkswagen’s EV sales rose 180% to roughly 19,500 cars.

Everything is relative, especially when it comes to 23andMe.

Shares in the DNA testing company — known for connecting relatives past and present — plummeted 60% on Monday, a day after it filed for bankruptcy.

CEO Anne Wojcicki stepped down, but the cofounder remained on the board and says she is trying to keep the embattled firm in the family, so to speak, by buying it back. If she fails, the genetic data of 15 million customers could be sold off to the highest bidder.

Genetic Deficit

23andMe went bust for a simple reason that’s been recounted more times than Genghis Khan has descendants. In short, its chief service, DNA-testing, is one that customers tend to use only once, which made shoring up recurring revenues as challenging as facing Genghis Khan in battle.

The company went public in 2021 during the SPAC boom, had a peak value of $6 billion, and was for a time one of the trendiest companies of the pandemic. But attempts to make money came up flat: Personalized health and lifestyle advice as part of a premium 23andMe+ brand brought in less than half what subscribers initially forecast. A partnership to develop drugs using customer data with pharmaceutical company GSK saw just two of 50 drug candidates make it to early-stage human trials.

What’s been less pored over, and is now of acute concern to 23andMe customers, is what happens to their genetic data, which could soon go up for sale in a bankruptcy auction — especially since the genetic information, saliva samples, and health and family information 23andMe has gathered from customers isn’t subject to Health Insurance Portability and Accountability Act protections:

• First of all, the company told customers that, for now, there will be no changes to the way it houses and secures customer data and that it’s complying with all applicable laws. It’s still selling DNA testing kits and conducting business as usual. States including California, however, have told residents to delete any personal information with the company as soon as possible.
• If 23andMe goes to an auction, a bankruptcy judge could recommend the involvement of a consumer privacy ombudsman. When the cryptocurrency platform Celsius filed for bankruptcy last year, the U.S. trustee filed for the appointment of an ombudsman, given the company had financial data on 600,000 customers. After lab-testing startup uBiome went bankrupt in 2019, an ombudsman was appointed and recommended some restrictions on the sale of personal data.

No Silver Bullet: The Harvard Law Review found this month that the “bankruptcy consumer privacy ombudsman was well-intentioned but flawed by design,” noting ombudsmen lack the ability to intervene in cases and that judges give their expert view insufficient weight.