Headlines
Sneaker and apparel retailers blindsided by tariffs on Asian factory hubs
Published by Global Banking & Finance Review®
Posted on April 3, 2025
3 min readLast updated: January 24, 2026
Global Banking & Finance Review®
Company
Published by Global Banking & Finance Review®
Posted on April 3, 2025
3 min readLast updated: January 24, 2026
Tariffs on Asian factories could lead to higher prices for Nike and Adidas sneakers in the U.S., impacting the apparel industry significantly.
By Helen Reid
(Reuters) -Prices of Nike Jordan and Adidas Samba sneakers are likely to rise in the U.S. after President Donald Trump imposed a raft of new tariffs on Vietnam, China, and Indonesia, key manufacturers of sportswear and apparel.
Shares in Nike, Adidas and Puma dropped sharply on Thursday after Vietnam was targeted with a 46% tariff rate, Cambodia with 49%, Bangladesh with 37% and Indonesia with 32%, while Trump hiked tariffs on China by an extra 34 percentage points, following the earlier 20% tariffs.
Fast-fashion retailers H&M, which sources from China and Bangladesh mainly, and Zara owner Inditex were also hit.
"The April 2 tariffs seem purpose-built to hobble the apparel industry," said Dylan Carden, an analyst at William Blair in Chicago.
The new tariffs would increase the average U.S. import tariff rate on apparel from 14.5% in 2024 to 30.6%, according to calculations by Sheng Lu, professor of fashion and apparel studies at the University of Delaware.
Based on 2024 import values, the new tariffs would result in a total of $26 billion in duties on apparel, more than double last year's level, Lu said.
In the past years, apparel and sportswear brands have shifted their sourcing away from China due to escalating political tensions between Washington and Beijing and have imported more from countries including Vietnam, Indonesia, and India.
Retailers may not be able to fully offset these tariffs, as countering the impact of the levies on Vietnam alone would require price increases of 10% to 12%, according to UBS analysts.
"With additional tariffs proposed across other key Asian sourcing hubs, the scenario of shifting production now looks far less viable, narrowing the set of effective mitigation levers available to brands," the UBS analysts added.
The U.S. imported more than $15 billion in textiles and garments from Vietnam in 2024, which was roughly about 10% of Vietnam's total U.S. exports, according to a Jefferies note.
Nike produced half its footwear and roughly 30% of its apparel in Vietnam in its 2024 financial year, while Adidas relied on the Asian nation for 39% of its footwear and 18% of its apparel last year.
Shares of Nike tumbled about 8% in premarket trading, while Adidas dropped more than 10% to a one-year low. Puma's shares fell 10.7% to hit their lowest level since November 2016.
Rival sportswear makers, including Lululemon, Skechers, Under Armour, Hoka maker Deckers and On Holding were all down between 8% and 15% before the bell on Thursday.
Nike, Adidas and Puma did not reply to requests for comment on the tariffs, while On said it was "constantly monitoring the evolving situation".
(Reporting by Isabel Demetz, Helen Reid, Linda Pasquini and Aishwarya Venugopal; Editing by Amanda Cooper, Tomasz Janowski, Sriraj Kalluvila and Sharon Singleton)
President Trump imposed tariffs of up to 49% on apparel from countries like Vietnam, Cambodia, and Indonesia, significantly impacting the industry.
The tariffs are expected to lead to price increases of 10% to 12% for sneakers like Nike Jordan and Adidas Samba in the U.S.
Shares of Nike, Adidas, and Puma dropped sharply, with Nike falling about 8% and Adidas dropping more than 10% to a one-year low.
In 2024, the U.S. imported more than $15 billion in textiles and garments from Vietnam, which accounted for about 10% of Vietnam's total U.S. exports.
Retailers may struggle to fully offset the tariffs, as the increased costs could significantly impact their pricing strategies and profit margins.
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