New Balance had welcomed Trump’s election but is now against his tariff imposition on China.’ New Balance makes over 4 million athletic shoes every year. It has 5 New England-based factories and another in the works. However, components are imported from China, since these parts aren’t made anymore in USA. The upcoming Tranche-4 tariff hike will risk the company’s finances and limit its ability to reinvest into American factories, stated New Balance.
This is why Trump’s policies won’t bring jobs back. American companies have supply chains spanning across countries. China cannot be hurt with American companies, consumers and workers bleeding as well. Over 300 trade group members and company execs are ready to testify. They belong to a range of industries from toys to fireworks. New Balance often has fought moves to open trade up. The TPP agreement was strongly opposed by it since shoes imported from Vietnam would have received tariff removals.
Matt LeBretton of New Balance stated that Trump’s election was a positive step, saying that New Balance went unheeded during Obama’s turn, regarding the TPP agreement. These comments sparked outrage and customers burned shoes, protesting these remarks. Trump chose to withdraw from the deal soon. New balance is now claiming that new tariff impositions will not solve any foreign problems or bring China to the table.
While tariffs on footwear components imports wouldn’t help these objectives, New Balance’s business interests, investment, and manufacturing abilities would be hurt though, as per Monica Gorman of New Balance. The company is yet to respond. Trump initiated tariffs one year ago, negotiating for better laws regarding forced tech transfers and IP theft. However, negotiations have broken down. Tariffs have increased from 10% to 25% at the moment on over $200 billion of Chinese imports. Now, $300 billion of Chinese imports will face these tariffs as well.
Corporations like Foot Locker, Levi Strauss, Gap, Target, Costco and Walmart requested Trump to end the current trade war and make peace with China. Footwear associations state that suppliers for shoe components won’t be back. Despite tariffs on shoe imports, the US industry produces merely 25 million shoe sets and imports 2.5 billion shoe sets. Matt Priest of FDRA stated that despite high-enough duty rates, production had still left the country.