In Their Own Words: C-Suites Talk About Where Inflation is Right Now
Key Highlights
- Inflation remains a significant planning concern for large companies, with Federal Reserve officials raising their 2026 inflation forecast to 3.7% as energy-related cost pressures continue to move through the economy.
- Rockwell Automation executives are not planning for near-term moderation in semiconductor costs, particularly memory, even as supply remains available.
- Higher diesel prices are changing freight behavior, with Norfolk Southern seeing some shippers move additional products from trucks to rail.
- Five Below says growth is helping it offset some inflationary pressure by improving supply-chain economics, while Lincoln Electric is responding to persistent costs with additional pricing actions.
- Campbell’s says cost reductions alone are not enough to absorb current inflation, leading the company to raise prices across roughly 60% of its products.
Before and after the Federal Open Market Committee (FOMC) raised its benchmark interest rate last week, the conversation centered far more on inflation factoring into a possible decision than the Fed’s other mandate, maximum employment.
On the latter front, more economists and Fed officials have grown confident that the economy is in solid shape. On prices, though, opinion is coalescing around the idea that increases in energy prices are sticking around and that their secondary and tertiary effects are clearly working their way through the U.S. economy. FOMC members acknowledged as much as they took up their 2026 inflation forecast to 3.7% — while leaving their outlook for next at 2.3%.
Some other measures also don’t look great: Import prices in August were up 7% from a year earlier, which was the fastest increase in four years. Construction input prices are nearly 9% higher than a year ago. And the Congressional Budget Office said recently that higher oil prices stemming from the Trump administration’s war with Iran will push up early-2027 inflation by half a percentage point from its previous forecast.
That’s a synopsis of the economic and policy side of the inflation debate in mid-September 2026. But what’s happening in the trenches? Thankfully, we’ve been able to drop in on a handful of investment bank conferences over the past two weeks to collect a sample of what large-company executives are seeing and doing. For most leadership teams, these conversations provided the last commentary we’ll get from them before quarterly earnings start arriving late next month.
The tone? Not upbeat. Here are some of the things we heard when it comes to inflation and cost pressures from CEOs and other senior executives in a variety of sectors.
Rockwell: Why semiconductor costs remain an inflation risk
During a fireside chat at the Morgan Stanley 14th Annual Laguna conference, Rockwell Automation Chairman, President and CEO Blake Moret was asked how his team is doing when it comes to the cost and availability of semiconductors — crucial components of the company’s various lines of hardware — given the massive demand for chips from those leading the AI boom.
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charts_copper_67569652_bluebay2014_dreamstimeSupply shouldn’t be a problem, Moret told the audience, since Milwaukee-based Rockwell has long-term deals with its suppliers and “has done a nice job of buying ahead” where it could. But cost is another story, one that Moret said has been consistently placing more pressure on Rockwell’s development engineers as they look to lower the cost of the company’s products so Rockwell isn’t forced to push much more price to its customers.
“We’re not counting on any near-term moderation of the pace of increases, particularly in memory. I mean, that’s really the crux of it,” Moret said. “We’re not looking or basing our plans on a hope or expectation that moderates anytime soon […] We’re still getting the supply that we need, albeit at a very inflationary price.”
Norfolk Southern: How diesel inflation is shifting freight to rail
Transportation is a place where inflation can quickly influence behavior as shippers lean more on railroads when fuel-price increases force trucking companies to hike their rates. But Ed Elkins, chief commercial officer at Norfolk Southern, told the Laguna conference that his teams are seeing shifts beyond those of a typical intermodal move.
Shippers are pushing products such as coiled steel, various paper and consumer products and “even lumber” to the rails, too. And that raises a red macro flag for Norfolk Southern.
We’re doing everything we can to put as [many] sensors in the environment as we can to see what’s happening there. Because ultimately, over some period of time, that’s going to be a drag on the consumer.
- Ed Elkins, chief commercial officer of Norfolk Southern
“We are seeing some freight that is coming to us because of the extraordinary costs we’re experiencing on the truck side,” Elkins said. “We’re talking about $6 diesel. But out here [in California], it’s $8 diesel [that] we noticed on the way in, which is like science fiction. […] We’re doing everything we can to put as [many] sensors in the environment as we can to see what’s happening there. Because ultimately, over some period of time, that’s going to be a drag on the consumer.”
Five Below: How growth is helping offset higher transportation costs
Daniel Sullivan, CFO of discount specialty retail chain Five Below, delivered a mixed message, also with trucking in the spotlight, around input costs when speaking at the Goldman Sachs Global Consumer and Retail Conference in New York City. On the plus side of the ledger: The latest round of Section 301 tariffs put in place by the Trump administration appear to be less punitive to Five Below’s financials than previously expected and ocean transportation costs aren’t yet creating headaches.
Offsetting those positive trends are trucking costs.
“When you see diesel costs at the $6-a-gallon rate versus $3.50, $3.75 a year ago, we, like everyone else, feel that pain,” Sullivan said. “And so our back half of the year has a tariff tailwind and a fuel headwind that are almost identical [and] so don’t provide much of a put or take.”
Sullivan had an upbeat takeaway for investors, however, one that a lot of other public-company leadership teams have pointed to as well (and one we wrote about recently). Taken in aggregate, Five Below and its more than 2,000 stores aren’t seeing costs build because its growth is helping its supply chain function better and secure good contracts.
“It’s an exciting part of the evolving muscles we’re building in the company,” he said. “There is a real willingness and desire to work with us given our growth profile. And so, [in the] back half of the year, I anticipate on the product side a reasonable stability despite obvious pressures in resin, other chemicals and commodities.”
Lincoln Electric: Why persistent inflation is driving more price increases
Also discussing supply-chain pressures was Gabe Bruno, CFO and treasurer of Lincoln Electric, which sells industrial machinery and technology from 20 plants around the world and is a big player in welding and cutting tools. The equation is simple for Lincoln as its leaders look to preserve their margins in the face of “persistent” inflation, Bruno said. “More inflation, more cost pressures translate into more pricing actions.”
“We did take actions on pricing in the Americas segment. They have impacts beginning of September. You’ll see that mature in the fourth quarter. We also took actions on the international side, price actions that are going to take effect towards the end of September. You’ll see them fully realized in the fourth quarter […] It’s the logistics, some supply-chain challenges, we’re seeing the components.”
Campbell’s: How food companies are responding to persistent inflation
The leaders of food conglomerate Campbell’s are hopeful that various cost-saving programs kick in soon — their target through 2030 is $500 million, or more than 5% of total spending in the company’s recently-completed fiscal 2026 — and that a push to revitalize parts of their snacks portfolio (think Goldfish, Snyder’s pretzels and more) begins to grow the top line, too.
But President and CEO Mick Beekhuizen, CFO Todd Cunfer and their team can’t only sit and wait for those tactics to pay off. Speaking at the Barclays 19th Annual Global Consumer Staples Conference, they discussed their recent price hikes on roughly 60% of Campbell’s products and their outlook for the coming fiscal year. Cunfer called the price increases “kind of the last lever we have,” but added that cost cuts at factories or corporate were simply “not enough given the extreme amount of inflation that we are seeing right now.”
Barclays analyst Andrew Lazar asked about executives’ outlook through next summer, which implies raw material and packaging inflation of at least 5% and logistics inflation above 10%. What, Lazar asked, could make those numbers and the results they help produce move up or down?
Cunfer said the pace of improvement in the Campbell’s snack group will play a big role in producing upside to his targets. The other main variable: “Where is the oil? How does the Iran conflict settle or not settle? There’s a little bit of a variability in the second half, plus or minus around inflation. We’ve built in what we think is a cushion. But given this environment, you never know.”
You never know. That seems by far the most appropriate way to wrap up a collection of commentary on inflation these days.
About the Author
Geert De LombaerdeGeert De Lombaerde
Contributor
A native of Belgium, Geert De Lombaerde joined EndeavorB2B in September 2021 to cover public companies, markets, and economic trends primarily for IndustryWeek, FleetOwner, Oil & Gas Journal, T&D World, and Healthcare Innovation. His work focuses on strategy, leadership, capital spending, and mergers and acquisitions, and he also works with Endeavor Business Intelligence on surveys and data projects.
Geert has been in business journalism since the mid-1990s. With a degree in journalism from the University of Missouri, he began his reporting career at the Business Courier in Cincinnati, initially covering retail and the courts before shifting to banking, insurance, and investing. He later was managing editor and editor of the Nashville Business Journal before being named editor of the Nashville Post in 2008. He led a team that helped grow the Post's online traffic by an average of more than 15% annually before joining Endeavor.
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