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April 07, 2025
“This is how you start a global depression. After 80 years and five generations Trump just put us out of business” said Peter Baum, CFO/OO of Baum Essex, a New York-based manufacturer licensed to produce goods for brands such as Nautica, Betsey Johnson, and Steve Madden. During the first Trump administration in 2019, Baum moved factories from China to the Philippines, Cambodia, Vietnam, and India.
The announcement of a sweeping 46% tariff on imports from Vietnam has sent a shockwave across multiple industries. For many global brands, Vietnam is an attractive alternative to China amidst escalating U.S.-China trade tensions.
On April 3rd (Vietnamese time), President Donald Trump declared new tariffs targeting Vietnamese imports, part of a broader strategy to revive domestic manufacturing and reset trade balances.
The sudden imposition of such a steep duty threatens to do the opposite for hundreds of U.S.-based brands that had long relied on Vietnam’s manufacturing strength.
Retailers and manufacturers that had spent years repositioning their supply chains away from China now find themselves cornered. Some of the biggest names are already showing signs of strain:
Nike: With 25% of its production based in Vietnam, Nike’s shares tumbled over 7% following the announcement. The athletic giant had already projected a double-digit sales decline this quarter, and these tariffs may worsen its recovery outlook under new CEO Elliott Hill.
Deckers Brands: Parent company of Ugg and Hoka, Deckers has 68 suppliers in Vietnam. Its stock dropped nearly 10% as the news broke.
VF Corporation: The North Face, Vans, Timberland, and Jansport rely heavily on Vietnamese and Chinese manufacturing, which together make up 55% of their supplier base. VF shares sank over 8% in response.
Wayfair: With nearly 26.5% of U.S. furniture imports coming from Vietnam, Wayfair—already reshuffling its sourcing out of China—saw its stock plunge 12%.
Steve Madden: The brand was actively cutting Chinese imports by 45% in favor of countries like Vietnam. The new tariff nullifies that strategy.
Toymakers such as Hasbro, Mattel, Funko, and Crayola are deeply tied to Vietnamese production, particularly through partners like GFT Group, which runs five major factories in northern Vietnam. Companies like American Eagle Outfitters, which sources about 20% of its products from Vietnam, are also revisiting their production footprints.
For many of these brands, price hikes are likely inevitable. With inflation-weary consumers already pulling back, this adds pressure to either absorb costs or lose margin.
Companies will need to make tough decisions:
Renegotiate contracts with Vietnamese suppliers
Shift more production to other countries—at higher cost and logistical risk
Pass on costs to consumers already resistant to price increases
Rethink supply chain strategy from the ground up
For companies, the new tariff policies have raised questions about whether and where, to potentially move their manufacturing.
Schottenstein, American Eagle CEO, referred to eight years ago during the first Trump administration, when American Eagle also faced challenges and had to figure out a new plan.
Schottenstein said there’s another shift coming, but “nobody knows what the story is yet.”
“I wouldn’t be rushing,” he said. “You go rush, where am I rushing to? I don’t know where I’m rushing to.”
There remains the possibility that bilateral talks between governments may lead to adjustments, exemptions, or revised terms that reduce the overall impact.
Trump mentioned Vietnam as "A Great Negotiator" and the country has long demonstrated resilience, adaptability, and international credibility.
In the meantime, businesses should prepare for multiple scenarios, maintain supplier communication, and above all, resist impulsive moves until the dust settles. For now, calm and strategic thinking will be the most valuable assets on the ground.
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