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R ETAI L

Here’s what America’s top CEOs are saying about a possible recession in 2023
PUB LI S HE D T UE , D E C 6 2 0 2 2 • 1 : 5 7 PM E S T UPD AT E D T UE , D E C 6 2 0 2 2 • 7: 2 0 PM E S T

Rebecca Picciotto WATCH LIVE

KEY POINTS
CEOs from JPMorgan, General Motors, Walmart, United and Union Pacific are preparing for an economic slowdown.

Among the issues cited are rising interest rates, inflation and geopolitical concerns.

The companies are taking a conservative approach to 2023.

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General Motors CEO Mary Barra speaks during a visit of the US president to the General Motors Factory ZERO electric vehicle assembly plant in Detroit, Michigan on November 17, 2021.
Mandel Ngan | AFP | Getty Images

As 2023 approaches and the prospect of a recession looms, corporate America is preparing for a slowdown in consumer
spending.

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CEOs of major companies including Walmart and General Motors joined CNBC’s “Squawk Box” on Tuesday morning to talk
inflation, interest rates, geopolitics and what it all means for their outlooks in the new year.

Here’s what they said:

Jamie Dimon, JPMorgan

V I D EO 03:20

JPMorgan CEO Jamie Dimon: Inflation is eroding consumer wealth and may cause recession

Rising interest rates, record inflation, geopolitical pressure and other factors could coalesce into a recession, JPMorgan Chase
CEO Jamie Dimon told CNBC.

Savings and government aid during the pandemic are helping keep consumer wallets stable, but inflation and rate hikes are
“eroding everything,” he said.

The CEO projected that the elevated consumer spending of 2022 will not last much longer, and underscored the risk posed by
rising interest rates as the Fed works to curb inflation.

This year’s geopolitical upheaval, including the war in Ukraine and strained trade with China, are also among the “storm clouds”
Dimon is watching. As the dollar strengthens, he noted that international trade for something like oil will continue to get more
expensive since weaker currencies are forced to match the difference.  

“When you look out forward, those things may well derail the economy and cause this mild to hard recession that people are
worried about,” Dimon said. “It could be a hurricane. We simply don’t know.”

Mary Barra, GM

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V I D EO 04:05

The consumer is still strong, but we are planning for conservative 2023, says GM CEO Mary Barra

General Motors CEO Mary Barra anticipates economic headwinds next year but is not sounding the alarms for a recession just
yet.

“I’m not going to call a recession, that’s for economists to do,” Barra told CNBC. “But right now, we’re still seeing a pretty strong
consumer.”

Even so, the car manufacturer is proceeding with caution to be prepared for a potential collapse in demand, similar to what other
industries have seen. During the pandemic, when consumers were spending less on travel and services, some industries saw
elevated demand and were caught off guard when that demand later disappeared.

Barra said GM is preparing “a fairly conservative 2023” cost-wise to avoid being blindsided, but that she is still seeing “pent-up
demand” lingering from the pandemic.

Barra also expects issues problems from the pandemic, such as semiconductor shortages and strained supply chains, to persist
into 2023 despite improvements each quarter.

Doug McMillon, Walmart

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V I D EO 05:01

The U.S. consumer is still stressed and under inflation pressure, says Walmart CEO Doug McMillon

Walmart CEO Doug McMillon doesn’t want a recession, but he thinks it might be a necessary evil to ease inflation for his
customers.

“We’ve got some customers who are more budget conscious that have been under inflation pressure now for months,” McMillon
said. “Should the Fed do what it needs to do, even if it is a much harder landing than we’d like? I think inflation needs to be dealt
with.”

Though Walmart is still seeing strong spending, McMillon has spotted more conservative spending in certain categories like
electronics and toys.

Walmart has seen its pandemic-era staffing issues begin to subside as it has raised wages, but McMillon noted there’s still hiring
pressure at the cashier level. If a hard recession hits, McMillon ensured that Walmart would not turn to staffing cuts.

“Customers and members need to be served so that’ll drive our headcount. Growth will probably continue to go up,” said
McMillon.

Scott Kirby, United Airlines

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V I D EO 04:1 1

United Airlines CEO Scott Kirby: We expect a mild recession, but travel is still setting records

United Airlines CEO Scott Kirby told CNBC that his company is entering the year with optimism but that 2023 might see a
“mild recession induced by the Fed.”

Business travel is enjoying a steady rebound from its pandemic-era collapse, but Kirby said that traveler demand is plateauing,
which might indicate “pre-recessionary behavior.”

And even though the industry is in the “eighth inning” of Covid recovery, Kirby said it is still battling problems left over from the
pandemic, such as a pilot shortage and expensive fuel.

For now, Airlines have reaped the benefits of hybrid work, with the increase in remote work giving people more flexibility to
travel, said Kirby.

United still maintains a positive outlook as its revenue numbers continue to rise. Kirby said the company is “coming back to near
all-time profit margins.”

“If I didn’t watch CNBC in the morning – which I do – the word recession wouldn’t be in my vocabulary,” Kirby said. “You just
can’t see it in our data.”

Lance Fritz, Union Pacific

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V I D EO 05:1 0

The U.S. economy is clearly slowing, says Union Pacific CEO Lance Fritz

Shipping is slowing down, Union Pacific Railroads CEO Lance Fritz told CNBC, a sign that consumer spending is tapering off
and the economy is tightening.

“The housing market has clearly slowed and parcel packaging has clearly slowed and we are seeing that in paper and parcel
shipments,” he said.

Fritz left it up to the Fed to decide whether putting pressure on the consumer’s wallet – and potentially triggering a 2023
recession – is worth slowing down inflation. As rates continue rise, he said spending and demand will surely come down.

“The Fed is trying to hit all of us in the line of fire with a slower economy and hurting demand. It’s not good,” said Fritz.

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