US shoe company Steve Madden has announced plans to rapidly halve its Chinese production, citing the threat of steep tariffs imposed by President-elect Donald Trump. The move comes just days after Trump’s reelection and is seen as a precautionary measure to avoid significant costs.
According to CEO Edward Rosenfeld, the company had planned for this scenario months ago and is now putting its plan into action. Steve Madden imports about 70% of its goods from China, which would be subject to Trump’s proposed tariffs ranging from 10% to 20%.
The company will instead source its products from Cambodia, Vietnam, Mexico, Brazil, and other countries. Rosenfeld expects the percentage of Chinese-sourced goods to drop to between 40% and 45% over the next year.
Industry experts warn that this move is unlikely to be followed by others due to the high costs associated with shifting production to alternative countries. The National Retail Federation estimates that Trump’s tariffs could increase the price of a $50 pair of sneakers by $59 to $64, and result in an additional $24 billion in costs for Americans.
Mainstream economists have criticized Trump’s tariff proposals as akin to a $3 trillion tax hike, with some experts warning of inflationary risks. However, Treasury Secretary Steven Mnuchin believes that Trump will be careful not to reignite inflation and has previously granted tariff exceptions on products that would impact US companies.
Source: https://edition.cnn.com/2024/11/08/economy/steve-madden-china-trump-tariffs/index.html