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Kraft, McDonald's, Whirlpool CEOs warn US consumer spending is weakening
Kraft Heinz is cutting prices and increasing promotions, while Whirlpool says discretionary demand is down about 15%.
Top corporate leaders including Kraft Heinz, McDonald's and Whirlpool have warned that US consumers are coming under intensified financial pressure, citing squeeze points from inflation, high borrowing costs and rising grocery bills, according to commentary cited by Yahoo Finance. Kraft Heinz CEO Steve Cahillane said lower-income consumers are running out of money sooner, pointing to negative cash flow in those brackets as households dip into savings. Cahillane also described years of volume degradation tied to consumers absorbing too much price, and he added that further price increases could add pressure to already-stretched budgets. Yahoo Finance reported that Kraft Heinz is responding by cutting prices on some products, increasing promotions and rolling out smaller package sizes at lower price points. McDonald's CEO Chris Kempczinski also pointed to heightened anxiety among consumers, while the company's CFO Ian Borden said higher gas prices are hitting lower-income households particularly hard, with those customers pulling back on spending. Whirlpool CEO Marc Bitzer described a sharp pullback in demand for big-ticket appliances, and Yahoo Finance said the company’s North America executive president, Juan Carlos Puente, characterized the environment as recession level contractions, with discretionary demand down roughly 15%.