Federico Furia, Product Director at International Brands Group BV writes on LinkedIn: The Trump administration’s proposed tariffs on Chinese-made footwear could drastically reshape the global footwear market, impacting production costs, consumer prices, and industry dynamics worldwide. Given that approximately 70% of shoes sold in the U.S. are produced in China, tariffs as high as 60% on Chinese imports would lead to significant price increases for American consumers, with some projections estimating cost hikes of 10-25% on retail footwear. This rise would burden consumers and challenge U.S.-based footwear companies that heavily rely on cost-effective Chinese manufacturing.

As U.S. brands look to avoid higher costs, many may exit China and seek production bases elsewhere. Southeast Asian countries, such as Vietnam and Indonesia, are primary candidates due to their existing infrastructure and relatively lower labor costs. However, these nations have limited capacity to absorb large production volumes from China. For example, Vietnam’s production is near full capacity for certain categories, and its costs have been rising due to demand. As a result, brands may also explore other emerging markets, like Bangladesh and African nations, although these areas would require significant investments to meet the quality, scalability, and logistical needs of global footwear brands.

Europe could potentially benefit from U.S. brands exiting China by attracting investments in manufacturing within the European Union. European brands could also capitalize on this shift by strengthening their supply chains in neighboring regions, enhancing their ability to meet rising demand from American brands that seek new partnerships. Additionally, higher tariffs on U.S. imports might prompt European consumers to prefer local or regional brands over American ones due to higher costs.

In the long term, the footwear industry may increasingly focus on automation and digital solutions to mitigate high labor costs and tariffs. Brands could adopt sustainable production methods and explore on-demand manufacturing closer to major markets. While challenging, these shifts might ultimately encourage industry diversification and reduced dependence on a single production base like China.