Coca-Cola may be compelled to increase its use of plastic bottles in the U.S. due to potential cost hikes in aluminum cans resulting from tariffs imposed by former President Donald Trump, according to the company’s CEO, James Quincey, during an investor call.
Trump’s decision to implement a 25% import tax on steel and aluminum could raise the cost of canned food and beverages across the country.
In December, Coca-Cola adjusted its sustainability goal, reducing its commitment to using 50% recycled materials in packaging by 2030 to a revised target of 35% to 40% by 2035.
Environmental groups have criticized the beverage giant, naming Coca-Cola the “top global plastic polluter” for six consecutive years.
“If one package suffers some increase in input costs, we continue to have other packaging offerings that will allow us to compete in the affordability space,” Quincey said.
“For example, if aluminium cans become more expensive, we can put more emphasis on PET [plastic] bottles”.
The Coca-Cola boss also sought to minimise the impact of the tariffs on his business saying packaging is only a relatively small component of his company’s costs.
In recent years, Coca-Cola has leaned towards aluminum containers as part of its marketing and sustainability efforts. Although aluminum cans are generally more expensive, they are significantly more recyclable than plastic bottles over time.
The U.S., which imports nearly half of its aluminum, faces higher costs due to the 25% tariff on all aluminum imports, as reported by the United States Geological Survey.
Unlike previous steel tariffs in 2018, where many can manufacturers secured exemptions, Trump has ruled out exceptions for specific products or countries this time.
Adding to environmental concerns, Trump recently signed an executive order ending a U.S. government initiative to replace plastic straws with paper alternatives.
This move reversed a measure by former President Joe Biden, who had described plastic pollution as a “crisis.”