American middle-class consumer confidence plummets, sales of McDonald's, Hershey, Harley Davidson, and others have been impacted

Trump's tariff policy has severely impacted consumer confidence in the United States, with the middle class and low-income groups tightening their belts. This trend has begun to be reflected in the financial reports of several companies that primarily target middle-class consumers—from McDonald's to General Motors, from Harley Davidson to Hershey, an increasing number of companies are facing declining sales and profit pressures.

McDonald's reported its first-quarter earnings on Thursday, stating that its sales at mature restaurants in the U.S. have fallen to the lowest level since the pandemic, due to reduced spending by low- and middle-income customers. CEO Chris Kempczinski told investors on Thursday, "People are becoming more cautious." Data shows that only high-income consumers have maintained stable purchasing frequencies, while middle-income customers have reduced their visits, and the decline in spending among low-income groups is even more pronounced.

Additionally, American fast-food giants Chipotle, Starbucks, Pizza Hut, KFC, and Domino's Pizza have all warned of declining sales in the U.S. market. Domino's CEO Russell Weiner stated in an interview:

People won't dip into their savings until they are more certain about what is happening.

Sharp Declines in Automobile and Motorcycle Sales, Candy Giants Also Hit Hard

Harley Davidson's first-quarter report shows that motorcycle sales have plummeted by a shocking 24% year-on-year. The company's CEO Jochen Zeitz told investors on Thursday that the uncertain economic outlook and high interest rates have suppressed demand in the U.S. and globally. Although the company is considering raising prices to offset tariff costs, he acknowledged:

We must recognize the current recessionary environment for leisure products.

The collapse in sales of these high-end consumer goods indicates that economic uncertainty is rapidly spreading to a broader consumer base.

General Motors stated on Thursday that while its sales growth exceeded that of other major automakers earlier this year, it is facing tariff costs of $4 billion to $5 billion, leading the company to lower its annual profit forecast by $2 billion to $3 billion.

Notably, even after Trump softened the impact of tariffs on automakers this week, General Motors still expects to raise prices in North America by up to 1%, whereas before the tariff increase, the company had anticipated a price decrease of 1% to 1.5%. About half of the cars sold by General Motors in the U.S. are domestically produced, while its cheapest brands, including the Chevrolet Trax and Buick Envista, are imported from South Korea.

Candy giants are also facing severe impacts. Hershey reported a 15% decline in sales of candy, mints, and gum in the first quarter, with executives continuing to see "consumer focus on value." Tariffs on raw materials like cocoa beans are expected to cost the company $15 million to $20 million this quarter, and company executives stated plans to raise prices later this year. The candy giant is seeking exemptions for its key raw materials, as cocoa cannot be grown domestically.

Strong Performance from Apple, but Concerns About Recession Persist

Despite strong performances from some tech companies, Apple's second-quarter sales surged due to increased demand for iPhones (analysts believe this may stem from panic buying by consumers before the new tariffs took effect), analysts warn that ongoing uncertainty in the U.S. poses a real risk to both the domestic and global economy TS Lombard analyst Grace Fan wrote in a report to investors on Thursday:

The risks of a recession in the U.S. and global economy are increasing. The biggest risk is that ongoing market volatility triggers reflexive reactions, leading to a collapse in business and consumer confidence, with signs indicating that this is already happening