The imposition of new U.S. tariffs by President Donald Trump has led to significant declines in the stock prices of major sportswear companies Nike, Adidas, and Puma, all of which depend heavily on Asian manufacturing hubs.
Vietnam, Cambodia, Bangladesh, Indonesia, and China are at the core of Trump’s tariff targets, with Vietnam facing a 46% tariff, Cambodia 49%, Bangladesh 37%, Indonesia 32%, and an increased 34% tariff on China—on top of existing 20% duties.
These tariffs pose a substantial threat to margins, potentially erasing over 10 percentage points and hampering sales amid inflation concerns, according to Felix Dennl, an analyst with Metzler in Frankfurt. He anticipates that sporting goods companies will likely hike prices in the U.S. to mitigate these added costs.
On this development, Nike shares saw a 8.47% drop in pre-market session, while in Germany, Adidas fell 10.45%, marking its lowest level in almost a year, and Puma declined 9.41%, reaching its lowest point since November 2016.
Nike and Adidas’ reliance on Vietnam is significant, with Nike producing half of its footwear and 28% of its apparel there, and Adidas sourcing 39% of its footwear and 18% of its apparel from the country. Additionally, Adidas depends on Indonesia and Cambodia for 32% of its footwear and 23% of its apparel, respectively.
The tariff shockwave also hit other retailers reliant on Asian production, with Sweden’s H&M, sourcing primarily from China and Bangladesh, seeing a 3.97% drop, and Zara owner Inditex falling by 2.41%.
