• Loading stock data...
Thursday, July 3, 2025

Sportswear Giants Are Ready for Trump’s Tariffs This Time Around

Companies like Nike and Adidas have done a lot of work to reduce their reliance on China for manufacturing goods. That will help them if Trump imposes new tariffs.

A line of Black Friday shoppers streams into the Nike Store at Tanger Outlets in Pooler.
Imagn Images

“Tariffs are the greatest thing ever invented,’’ President-elect Donald Trump said at a campaign stop in Flint, Mich., in September. 

During his reelection campaign, Trump said he’d raise tariffs on imports from China to 60%, and he floated a baseline tariff on goods coming into the U.S. from everywhere else. On Monday, Trump fleshed out those threats on his social media platform Truth Social, writing he’d impose a 25% tax on all U.S. imports from Canada and Mexico, and an additional 10% tariff on goods from China as one of his first moves in office. Trump has long railed against an unfair trade relationship with China, and he levied tariffs on more than $380 billion worth of goods in his first term, according to the Tax Foundation

If Trump starts slapping tariffs on countries like Canada and Mexico, “there will be a huge outcry from business leaders,” Morningstar retail analyst David Swartz tells Front Office Sports

But this time around, retailers are more prepared. 

“I think broadly speaking, most companies have cut their exposure to China by 50% since 2018,” says Cristina Fernández, senior research analyst at Telsey Advisory Group.

Made in Vietnam

In the world of sportswear and sneakers, many big brands have already shifted manufacturing away from China—work that began in some cases even before Trump’s first term. “The tariffs hastened it,” Swartz says. “It allowed them to do long-term planning to move to other countries. Nike’s No. 1 country for manufacturing shifted from China to Vietnam years ago.

In fact, the biggest beneficiary of tariffs from the first Trump term wasn’t the U.S., says Swartz—it was Vietnam. “And it will be the same this time, too.” Indonesia and Bangladesh also took some manufacturing share from China after Trump’s first tariffs in 2018.

In its third-quarter earnings call on Nov. 19, Amer Sports CFO Andrew Page answered analysts’ questions about what the impact of more tariffs on U.S. imports would mean for the Finnish company that owns Arc’teryx, Salomon, Louisville Slugger, and Wilson.

Page said the company isn’t overly concerned. “Greater China represents less than 30% of Amer Sports’ global sourcing,” he told analysts on the call, adding “sourcing from China to the U.S. market represents only 10% to 12% of total group revenues.” Page said the company’s ball and racket segment would be most affected, predominantly tennis rackets, baseball bats, and basketballs. “We have some degree of flexibility to adjust our supply chain, but price increases will be the primary tool we utilize should tariffs occur,” he said. 

Only about 15% of goods made by companies like Adidas and Under Armour are sourced from China, Fernández says: “They have done a lot of work over the years to reduce the amount that’s coming to the U.S. from China.” Nike said in its 2024 annual report that factories in Vietnam, Indonesia, and China manufactured approximately 50%, 27%, and 18% of total Nike brand footwear, respectively. 

In Adidas’s first-quarter earnings call in July, CEO Bjørn Gulden said the sportswear company has tried not to source products anymore from China into the U.S. “The supply chain is going to be more local,” he said. “America cannot really buy from China. So we are ending up having a supply chain that we have broken up into more local supply chains which, again, can bring more speed and agility into our pipeline.”

Under Armour CFO David Bergman told analysts on its Q2 2025 earnings call this month that any additional tariffs “could impact our cost of goods sold and gross margin,” but “it’s something that we were prepared to manage pretty well before.” 

“So right now, we’re not anticipating any real sizable impacts, but it’s something we’re going to keep monitoring,” he added.

Tariffs on imports from China also won’t affect On Holdings, the Swiss sneaker brand, since almost all its footwear is made in Vietnam.

If the next round of tariffs is similar to the previous one, sportswear won’t be hit as hard as other consumer goods. Tariff rates on athletic apparel and footwear were lower than other categories, including furniture, home goods, and flooring, Fernández says.

Made in China for the China Market

A growing focus on producing more goods for local markets has also helped retailers. 

Nike and Adidas have said most of their products manufactured in China are specifically for the Chinese and Asian markets. 

And as some firms learned in 2018 when Trump implemented tariffs on millions of products imported from China in his first term, goods imported to the U.S. can be routed to other countries that don’t have tariffs before coming to the U.S. “Most companies use factories in multiple countries, so if there are products currently shipped from China to the U.S., they can likely be made in other countries,” Morningstar analyst Swartz says. Companies can also ship products from China to other countries and then to the U.S. to get around the tariffs.

Economists broadly agree tariffs function as a tax on companies and ultimately consumers. Typically, companies can respond to tariffs in several ways: Pass the increased cost down to consumers, absorb it, or negotiate with their suppliers.

The Tax Foundation recently estimated that the Trump and Biden tariffs so far (President Biden kept most of the Trump Administration’s tariffs in place) are equal to an average annual tax increase on U.S. households of $200 to $300 a year. 

As of March 2024, the trade war tariffs have generated more than $233 billion in extra taxes collected for the U.S. government from Americans. Interestingly, $89 billion, or about 38%, was collected during the Trump Administration, while the remaining $144 billion, or about 62%, has been collected during the Biden Administration. 

Linkedin
Whatsapp
Copy Link
Link Copied
Link Copied

What to Read

Dec 29, 2024; Philadelphia, Pennsylvania, USA; Dallas Cowboys quarterback Cooper Rush (10) passes the ball against the Philadelphia Eagles during the first quarter at Lincoln Financial Field.
breaking

California AG Says Daily Fantasy Sports Are Illegal

The AG rejected arguments that DFS are games of skill, not chance.

Geoffrey Esper Can’t Catch a Break at Nathan’s Hot Dog Eating Contest

“Hot dogs is not one of my favorite competitions of the year.”
Jun 9, 2025; Cleveland, Ohio, USA; Cleveland Guardians starting pitcher Luis Ortiz (45) throws a pitch during the first inning against the Cincinnati Reds at Progressive Field.

Guardians Pitcher Luis Ortiz Put on Paid Leave Amid MLB Probe

Reports say the investigation is tied to gambling.
Mike Crapo

Trump Bill’s Tax Hike on Gamblers Was Authored by Sen. Mike Crapo

Crapo’s office did not respond to several messages seeking comment.

Featured Today

The Battle Over Wimbledon’s Ambitious Expansion Plan

A classic NIMBY standoff on one of the most hallowed grounds in sports.
Seattle Rough & Tumble
June 28, 2025

Women’s Sports Bars Are on the Rise. Survival Isn’t Guaranteed

Some women’s sports bars are cashing in. Others are clawing for funding.
June 27, 2025

Shitposters Have Taken the Reins of Pro Sports’ Official Voices

Meet the social media pros turning sports teams into internet trolls.
Jun 17, 2025; Sunrise, Florida, USA; Florida Panthers center Sam Reinhart (13) hoists the Stanley Cup after winning game six of the 2025 Stanley Cup Final against the Edmonton Oilers at Amerant Bank Arena
June 26, 2025

Stanley Cup’s International Summer Tour: Rules, Repairs, and Raucousness

No pro trophy tour compares to the NHL’s three-month global victory lap.
A Lululemon store at Freehold Raceway Mall in Freehold Township, New Jersey on Nov. 30, 2023

Sportswear Stocks Rise as Trump Touts Vietnam Trade Deal

Tariffs on Vietnam imports will be 20%, down from a prior threat of 46%.
Jun 20, 2024; Eugene, OR, USA; Detailed view of Nike Alphafly 3 racing flat at the Nike by Eugene store.
June 25, 2025

Investors Hunt for Signs Nike Has Regained Its Footing

Nike’s fundamentals are “still challenged.”
From vintage to unique collaborations, various Nike and Jordan shoes are displayed on a wall at Saved Soles inside West Ridge Mall.
June 26, 2025

Nike Stumbles Less Than Expected, Giving Wall Street Hope

The sports apparel and footwear giant beats Wall Street expectations.
Sponsored

Hottest Matchups Following NFL Schedule Release

The NFL released the 2025 regular-season schedule, and anticipation is already building in the ticket marketplace with four months to go.
Jun 15, 2025; Oakmont, Pennsylvania, USA; JJ Spaun putts on the 18th green to win during the final round of the U.S. Open golf tournament.
June 16, 2025

‘Pandemonium’: Putter Maker Sees Sales Surge After JJ Spaun’s U.S. Open Win

The company behind Spaun’s putter is already in talks with his people.
June 13, 2025

U.S. Open Merch Pops Thanks to Oakmont’s Squirrel, Viral TikToks

There are more than 400,000 pieces of merchandise available at Oakmont.
Tom's Watch Bar
June 12, 2025

How the Pacers and Caitlin Clark Boosted One Bar’s Bottom Line

Tom’s Watch Bar hosted John Haliburton for at least five games.
June 12, 2025

U.S. Open Cashing In on Signature Cocktail Trend With Lemon Wedge

Last year, the whiskey cocktail was served more than 50,000 times.