U.S. shoemakers warn about tariff impacts on the industry
Updated 22:39, 28-Jun-2019
William Denselow
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U.S. shoemakers are warning that the trade war between Washington and Beijing could have a significant impact on their industry.

Major brands such as Nike and Under Armor are urging the Trump administration to exclude them from a potential new round of tariffs.

Nearly all the shoes sold in the U.S. are imported and higher tariffs could see customers footing the bill.

The clear plastic containers in Kendell Roberts' New York storage locker are stacked up high enough to nearly reach the ceiling. Each box contains a pair of sneakers.

Roberts has been collecting them for more than 15 years and has spent around 50,000 U.S. dollars in the process. He currently owns around 375 pairs and has to reach over his head to reach the sneakers kept at the top of each pile of shoes.

But higher tariffs on imported footwear could soon lead to higher prices for collectors.

"There are people that may not have the money to just buy any pair of sneakers that they want," Roberts said. "They may have to dial back on buying certain sneakers and have to compromise on what they want."

A Nike store in Beijing. /VCG Photo

A Nike store in Beijing. /VCG Photo

Last year, 2.5 billion pairs of shoes were imported to the U.S. and more than half of those came from China.

Imported shoes are already subject to duties and the Trump administration is threatening a new round of tariffs on an additional 300 billion U.S. dollars worth of Chinese goods. That could mean an added 25 percent onto the price tag.

Bernie Gross, the creative director of a boutique sneaker and apparel store in Manhattan's Lower East Side says some shoes currently worth 400 U.S. dollars could retail closer to 500 U.S. dollars if the tariffs come into effect.

The global sneaker industry is valued at an estimated 55 billion U.S. dollars and some retailers fear tariffs, and the threat of higher costs, could alter consumer behavior.

"If the core price is inherently going up, it might actually force the consumer to really only consider that top tier, that premium product," Gross said. "You're better off getting the bang for your buck then."

More than 170 footwear companies including Nike and Under Armor have written to the Trump administration calling for their products to be removed from the tariff list. They say a failure to do so would be catastrophic for the industry, consumers and the U.S. economy.

The Footwear Distributors and Retailers of America warned a tariff hike could cost shoppers an extra seven billion U.S. dollars a year and the trade war is already impacting how some footwear makers operate.

"Firms are A,B,C – Anywhere But China," said Joseph Foudy, a business professor at New York University. "They are just radically reducing their exposure because even if we get an agreement today, who’s to say that it doesn't break down, and we're not looking at a new round of tariffs late this year or early next year."