The U.S. sneaker market is valued at $21.2 billion, according to Cowen Equity Research, and while sneakers were left off President Trump’s most recent duty list, many sneaker fans are wondering what effects a new round of tariffs could have on the booming industry.
On May 10, Trump made good on his promise to raise tariffs by 15% on $200 billion worth of Chinese imports. The now 25% tariffs are meant as a punishment to China for the country's refusal to accept the Trump Administration’s latest version of a potential trade deal. Trump also ordered the Office of the United States Trade Representative (USTR), to begin the process of raising tariffs on essentially all remaining imports from China, which are valued at approximately $300 billion.
In response, the Footwear Distributors and Retailers of America (FDRA) tweeted at Trump:
“Footwear is already hit with a $3 billion tariff bill EVERY Year. That's enough to buy 855 Starbucks coffees for everyone in Manhattan! 80% of kids shoes are made in China - U.S. families cannot afford even higher tariffs on shoes! Please - NO new shoe tariffs!”
‘What if’ scenarios
Thousands of consumer goods will be affected by the new 25% tariffs, from live eels and cranberries to electrical lamps and buttons. However, it’s the items left off the list that have many speculating “what if” scenarios.
Matt Priest, president and CEO of FDRA, however, says that if a new round of tariffs including footwear would have a “staggering” impact on the American consumer and sneaker industry.
“Higher costs for our consumers means we sell less shoes. This threatens jobs in our industry and could put U.S. footwear companies out of business,” he said.
Reggie Wade is a writer for Yahoo Finance. Follow him on Twitter at @ReggieWade.
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