Coca-Cola considers alternative PET packaging amid Trump tariffs

USA – The Trump administration’s imposing a 25% tariff on foreign steel and aluminium has prompted Coca-Cola to reevaluate its packaging strategy in the United States.

The beverage giant, which relies heavily on imported aluminium for its drink cans, may be forced to use more polyethylene terephthalate (PET) bottles to offset rising costs.

The tariffs, introduced in 2018, were part of the administration’s broader trade policies to boost domestic manufacturing.

However, they have significantly increased the price of aluminium, impacting industries reliant on metal packaging, including beverage and food manufacturers.

Higher aluminium costs could lead to pricier canned drinks, so Coca-Cola is actively exploring alternative packaging solutions to maintain its competitive edge.

Coca-Cola CEO James Quincey acknowledged the challenges posed by the tariffs but downplayed their overall impact on the company’s financial performance.

He noted that packaging accounts for only a small portion of Coca-Cola’s total expenses, suggesting that while cost pressures exist, they are unlikely to cause a fundamental shift in the company’s operations.

“I think we’re in danger of exaggerating the impact of the 25% increase in aluminium price relative to the total system. It’s not insignificant, but it won’t radically change a multibillion-dollar US business,” Quincey stated.

Despite these reassurances, Coca-Cola’s potential shift towards PET bottles raises concerns about sustainability.

The company has been trying to reduce its environmental footprint, gradually increasing the proportion of its beverages sold in aluminium cans, which are more recyclable than plastic.

Environmental groups have frequently identified Coca-Cola as one of the world’s most significant contributors to plastic pollution.

A move towards more significant PET usage could invite criticism, potentially conflicting with its sustainability commitments.

Coca-Cola’s predicament highlights the broader implications of protectionist trade policies on global supply chains.

While intended to bolster American industry, tariffs on raw materials such as aluminium can have unintended consequences. They can push companies to seek cost-effective alternatives, even if they conflict with environmental or long-term business strategies.

As Coca-Cola continues to navigate these challenges, its packaging choices will be closely watched by consumer policymakers and environmental advocates concerned about the balance between economic resilience and sustainability.

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