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Adidas products may become costlier in the US, thanks to Trump tariffs
The company said that the global trade dispute was preventing it from raising its full-year outlook despite a substantial increase in first-quarter profits, according to a report by CNBC. 'Higher tariffs will eventually cause higher costs for all our products for the US market,' Adidas said in a statement as quoted by CNBC.
After Trump imposed 145 per cent tariffs on imports from China, Adidas said it had already reduced its China-made products shipped to the US to a minimum. Yet, the biggest impact on the company is from the general 10 per cent tariffs imposed on all other counties by the US.
'Given the uncertainty around the negotiations between the US and the different exporting countries, we do not know what the final tariffs will be,' the Adidas statement mentioned.
No clarity on what to do
Currently, various countries are in talks with the US to reach a trade agreement to avoid elevated tariffs, ensuring fair trade practices. As a result, companies across the world are unclear on their businesses and are unable to make decisions on their future course of work, including Adidas.
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'Therefore, we cannot make any 'final' decisions on what to do. Cost increases due to higher tariffs will eventually cause price increases, not only in our sector, but it is currently impossible to quantify these or to conclude what impact this could have on the consumer demand for our products,' Adidas explained in its statement, as quoted by CNBC. Adidas said it was currently unable to produce almost any of its products in the US.
Retailers weigh cost of tariffs
The company, famous for sneakers like Superstar, Sambas, Stan Smiths, and Gazelles, as well as sportswear, makes its products in countries like Vietnam and Cambodia. These countries could face US tariffs of over 40 per cent because there is no trade deal, according to the media reports.
Global uncertainty caused by tariffs
The Trump tariffs created global uncertainty by raising import taxes on goods from countries like China, Vietnam, and others, disrupting global supply chains. Businesses were unsure about future costs, trade policies, and sourcing decisions, leading to price increases, shifting manufacturing locations, and concerns about demand and profits. This uncertainty affected everything from low-cost retailers to luxury brands.
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