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20 Nov 2024

Features Nike

How Will Trump Tariffs Affect Sneaker Prices? Here’s Everything You Need to Know

trump-tariffs-sneaker-prices-impact

Donald Trump has proposed new tariffs on Chinese imports, aiming to bolster domestic manufacturing and reduce reliance on foreign goods. The measures include a steep 60 per cent tariff on products imported from China and a 10–20 per cent tariff on goods from other countries. For the sneaker industry, which has long relied on China as a key manufacturing hub, these changes could have far-reaching consequences. Let’s explore how these new tariffs might impact sneakerheads.

‘OK, give me the TLDR on the Trump tariffs’

Donald Trump's proposed tariffs aim to reshape the U.S. economy by boosting domestic production and reducing reliance on imports. For the sneaker market – historically reliant on manufacturing powerhouses like China – this could mean increased costs due to higher import taxes. The result? Price hikes that sneakerheads and casual consumers alike will likely feel.

‘How much is this actually going to affect the price of sneakers?’

It’s hard to say. This isn’t a ‘one-size-fits-all’ situation. Everyday staples like and might see modest price bumps, but for limited-edition drops and hyped colabs? Expect steeper mark-ups. Brands will almost certainly pass those higher production costs onto buyers. Retail prices could jump 10–20 per cent or more. For instance, a $100 pair might cost $120, while a $150 sneaker could easily hit $165 or higher.

‘Which brands will be most affected by the tariffs?’

Newsflash: China accounts for a staggering portion of global sneaker manufacturing. Let’s take a look at the major players and their manufacturing in the region.

Nike

  • Vietnam: ~50% of footwear production
  • Indonesia: ~24% of footwear production
  • China: ~22% of footwear production

adidas

  • Vietnam: ~40% of footwear production
  • Indonesia: ~30% of footwear production
  • China: ~20% of footwear production

PUMA

  • Vietnam: ~31% of total production
  • China: ~25% of total production
  • Indonesia: ~9% of total production

New Balance

  • Vietnam: ~30% of total production
  • China: ~25% of total production

ASICS

  • Vietnam: ~51% of footwear production
  • Indonesia: ~14% of footwear production
  • China: ~28% of footwear production

'How are the brands reacting?'

Both and have publicly criticised the proposed tariffs, arguing that they would harm both consumers and the American workforce. adidas also outlined how higher prices could deter a potential buyer, ultimately shrinking the market. In a previous instance back in 2019, both brands, along with other footwear companies, signed an open letter urging the U.S. government to reconsider tariffs on shoes made in China.

‘Hold up. Can’t they just move their manufacturing?’

Yes. Shifting operations is the first and most obvious solution to mitigate the impact of trade tariffs. But this ain’t easy. Building new factories, training workers and establishing supply chains takes a hell of a lot of time and cash – further driving up production costs. Still, some companies, like Steve Madden, have already announced plans to reduce its imports from China by 45 per cent next year.

‘What If China imposes their own trade tariffs?

If China imposes its own tariffs in response to U.S. tariffs, the economic effects will further complicate the global sneaker market. American-manufactured sneakers or components shipped to China could become more expensive, reducing their competitiveness against local or non-U.S. brands. Chinese consumers might shift toward domestic brands like Li-Ning and ANTA, which wouldn't be subject to the same tariffs.

‘Okay, so what’s next?’

The sneaker industry is bracing for impact. Brands are exploring ways to absorb the cost or pass them on to consumers. Some are considering long-term strategies like diversifying production hubs. Expect more vocal lobbying efforts from those invested in the China region. In the short term, expect a sting to your hip pocket. Long-term impacts are hard to predict, but stricter tariffs on China may accelerate a shift to regions like Southeast Asia, India, and Latin America. Of course, this won’t happen overnight, but it’s worth considering. Ultimately, Trump’s proposed tariffs are going to have a significant effect on the sneaker industry, and everyone from the titans up top to the sneakerheads on the street will feel the ripple effects.

20 Nov 2024

Features Nike

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