During a recent conference call, Craig Radcliffe, Apollo’s managing director in public policy, discussed how only four countries globally can produce sneakers at high volume. He emphasized the challenge for footwear companies in finding viable options due to the lack of credibility in bringing the supply chain back to the United States. The potential solution may lie in reducing consumption of such products.

Apollo Global Management calculates that Trump's tariffs will impose a consumption tax of at least 42% on most sneakers entering the United States, significantly impacting costs. Despite this, the cost advantage in Asia remains substantial, making relocating production economically unviable, particularly to the US.

The majority of sneakers, amounting to about $31 billion annually, come from Asian countries such as Vietnam, China, Indonesia, and Cambodia. These nations boast extensive and efficient supply chains, enabling cost minimization and scale maximization, benefiting both consumers with affordable products and companies with satisfactory profits.

Trump's tariffs are expected to raise prices with minimal job creation in America, ultimately resulting in losses for the US economy and consumers. The focus on low-value-added industries, like sneaker production, may not align with the goal of nurturing high-value-added sectors that spur innovation and offer substantial growth and income opportunities.

While Trump aims to bring manufacturing back to the US through tariffs, it may not yield the desired results, as highlighted by past analyses. The complex web of tariffs on various countries, including Vietnam, China, Indonesia, and Cambodia, will likely escalate costs for US importers and consumers.

Importers may face financial strain, inventory shortages, and reduced product selection due to the tariff impacts. Trump's stringent tariff policies could ultimately face legal challenges, although the fate of these trade measures may ultimately rest on public sentiment and future developments in international trade dynamics.