By John Keilman

Off-road vehicle maker Polaris said it may introduce a surcharge on some goods sold in the U.S. if the Trump administration's tariffs on imports from Mexico persist.

The Minnesota-based company's largest factory is in Monterrey, Mexico, accounting for a third of its production by revenue. Chief Executive Mike Speetzen told an investor conference Tuesday that Polaris has come up with preliminary numbers for a surcharge, though he held out hope the tariffs will be short-lived.

He was less optimistic about Trump's new tariffs on Chinese goods, saying he expects those to stick. Polaris has spent years trying to shift sourcing out of the country, but it still imports about $500 million of products annually for its factories in the U.S. and Mexico.

The company has tried to prepare for tariffs by ramping up orders from China and accelerating production in Mexico. Speetzen said the company moved inventory north of the border before the tariffs hit, letting workers in Texas apply decals and other finishing touches.

Polaris was already suffering from muted demand before the tariffs; its sales dropped 20% last year to $7.2 billion. Consumers are grappling with inflation and debt, Speetzen said, and he questioned how tariffs will affect their health.

"It's really tough to make a call on the consumer right now," he said. "It certainly is getting worse, not better."

This item is part of a Wall Street Journal live coverage event. The full stream can be found by searching P/WSJL (WSJ Live Coverage).

(END) Dow Jones Newswires

March 04, 2025 13:45 ET (18:45 GMT)

Copyright (c) 2025 Dow Jones & Company, Inc.