Under CEO Ynon Kreiz’s leadership, Mattel is shifting its strategy from toy manufacturing to intellectual property management, with the company positioning itself better than competitors despite relying heavily on Chinese production. As tariffs remain high, Mattel aims to diversify its global production base.
Toys are a fundamental part of children’s development. They play to a fundamental human behavior – ‘imagination and creativity.’ According to Ynon Kreiz, CEO of Mattel, toys should be exempt from tariffs globally.
Mattel has reduced its reliance on Chinese manufacturing to about 40 percent, a move that positions the company better than many of its competitors. Despite this, the industry still relies heavily on Chinese production, with roughly 80 percent of toys made in China. However, Kreiz notes that even if tariffs on Chinese goods remain high, Mattel is well-positioned due to its diversified manufacturing base.
Mattel Inc. is a multinational toy manufacturing company founded in 1945 by Ruth and Elliot Handler, along with Harold Matson.
The company's first product was the Uke-A-Doodle, a plastic ukulele.
Mattel gained popularity with its 'Barbie doll' introduction in 1959.
Today, Mattel produces popular brands such as Hot Wheels, Fisher-Price, and American Girl.
With headquarters in El Segundo, California, Mattel operates globally, employing over 22,000 people worldwide.
Diversifying Manufacturing Base
Today, only about 20 percent of Mattel products sold in the U.S. are made in China. The company manufactures in seven countries, including Indonesia, Malaysia, Mexico, and Thailand, which are currently subject to a 10 percent tariff. However, if Trump’s ‘reciprocal’ tariffs return, these countries may face steeper rates.
Kreiz aims to ensure that no single country accounts for more than 25 percent of Mattel‘s global production by 2027. This diversification strategy not only reduces the company’s reliance on Chinese manufacturing but also helps it navigate potential trade tensions.
A Shift from Toy Manufacturing to IP Management
Under Kreiz‘s leadership, Mattel has undergone a significant transformation. The company has evolved from a toy manufacturing business to an intellectual property (IP) management firm. Kreiz has revitalized iconic brands like Barbie and Hot Wheels while pushing the company into film and television production.
The success of the 2023 blockbuster ‘Barbie’ movie is a testament to this shift in strategy. Mattel‘s IP monetization efforts have enabled it to capture the full value of its intellectual property, driving business growth and diversification beyond toys.
