AriZona iced tea might be forced to change its 99-cent pricing for the first time since 1997. Company founder, Don Vultaggio, feared that despite weathering economic highs and lows for 28 years, a change might be in the offing.
Donald Trump's tariffs are to blame for the likely price rise. Vultaggio said that keeping the 99-cent price may no longer be feasible now that the 50 percent tariff on imported aluminum is in place, KTLA reported.
What AriZona iced tea founder said about price rise
“We’re holding the line for now despite rising aluminum costs,” the AriZona iced tea founder told the news outlet, adding, “It’s particularly unfair—80% of our can sheet metal comes from recycled US beverage cans, yet 100% of our aluminum is subject to tariffs.”
However, Vultaggio is no stranger to finding creative ways to maintain prices. In 2022, he told Nexstar how the company worked on keeping the 99-cent rate fixed despite Covid hurdles and record inflation.
They built production facilities around the US, to save money on shipping costs, and changed the lids of the cans to use less aluminum. In 2022, the company made the 23-ounce can smaller, reducing it to 22 ounces.
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{{/usCountry}}They built production facilities around the US, to save money on shipping costs, and changed the lids of the cans to use less aluminum. In 2022, the company made the 23-ounce can smaller, reducing it to 22 ounces.
Also Read | From groceries to cars, how Trump's hike on steel, aluminium tariffs could impact markets
{{/usCountry}}At the time, Vultaggio had said “Those are the kinds of things you do behind the scenes that don’t affect the consumer.” However, as of Wednesday, he said that it might no longer be possible to spare the customer.
“If pressures keep rising, we may have no choice but to adjust pricing, though we’ll work hard to avoid it,” the company founder added. While the company head didn't specify what the new cost for the tall cans would be, given the inflation as the sole determining factor, a can priced at 99 cents in 1997 would be worth $2.01 today.
However, Vultaggio has vowed to keep finding avenues through which the price of the beloved iced tea can be slashed.
For example, the company uses polyethylene terephthalate (PET) in plastic packaging, and he told The New York Times that the cost of plastic bottles would be going down from $1.25 to $1. “Wherever we see savings—like lower crude oil costs for PET—we’re passing them to customers with deeper promotions or outright price cuts, including plastic tall boys at $1,” he said.