A slowdown in demand is affecting companies across the retail and travel industries, with CEOs from strong firms such as Delta, Walmart, and Dick’s Sporting Goods striking cautious tones. The decline is partly due to President Donald Trump’s trade war, which has raised prices for consumers and dampened spending.
Inflation remains higher than the Federal Reserve’s target, with consumer confidence hitting a record low in February. A separate measure showed a drop in March, indicating a worsening outlook.
The airline sector, particularly large international carriers, is also feeling the pinch. The CEOs of United, American, Delta, and Southwest airlines said they are seeing a slowdown in demand this quarter, with some cutting their first-quarter forecasts. Air safety concerns have also played a role, including two major airline accidents.
Retailers such as Abercrombie & Fitch and E.l.f. Beauty issued weak forecasts, but indicated positive views for the second half of 2025.
The shift in commentary from strong companies marks a warning sign that shoppers may be starting to crack under the pressure of tariff-induced price increases after four years of historic inflation. Companies are taking steps to reduce expenses and manage inventory as they brace for what’s still to come.
CEO Jay Schottenstein of American Eagle said consumers are becoming increasingly conservative due to uncertainty, including government cuts to programs. The company is taking measures to reduce expenses and manage inventory in anticipation of a potential slowdown.
Source: https://www.cnbc.com/2025/03/14/delta-walmart-warn-about-consumer-spending-amid-tariffs-inflation.html