Trump's Next Trade War Shot Could Hit Americans From Head to Toe
(Bloomberg) -- President Donald Trump’s next salvo in the trade fight could tax the shirt off America’s back -- literally.
The U.S. president’s threat to impose tariffs on virtually everything the country imports from China means everyday items including clothes and shoes in closets across America could be targeted, from Victoria’s Secret bras and Under Armour sports gear to Nike shoes. There will likely be no escape for Apple smartphones, either.
Trump on Friday said he’s lined up an additional $267 billion of Made-in-China products to tax “on short notice if I want.” Coupled with already proposed levies on $200 billion of goods that would crank up the price of household goods like fridges and freezers, the move would drag the American consumer squarely into Trump’s fight, with manufacturers and retailers from Target Corp. to Samsonite International SA warning tariffs will result in higher prices.
Here’s how the trade war might smack Americans next from head to toe:
On the Noggin
The U.S. imported about $1 billion worth of sunglasses, goggles and other eye wear last year from China, making it the top supplier, according to data from the U.S. International Trade Commission. Chinese-made Prive Revaux sunglasses now sold online at Walmart.com and priced at $29.95 may not be such a bargain.
China is also the top source for scarves and shawls, and the second-biggest supplier of hearing aids, according to U.S. data. At least one piece of headgear looks to be exempt from an import tariff: “Make America Great Again” caps are “proudly made in the USA,” according to donaldjtrump.com, Trump’s campaign website.
Covering the Gut
That weekend favorite, the do-it-all sweater, is in danger. The U.S. imported $4.6 billion of them from China in 2017 and another $606 million in T-shirts, tank tops and other casual shirts. Trump has tried to keep clothing staples in American closets out of the tariff fight, especially with mid-term elections due in November. Shoppers trying to keep warm this winter may see prices rise at Macy’s and Burlington Stores Inc. China is also the top exporter to the U.S. of men’s and women’s overcoats.
Chinese-made gloves and mittens sold by Walmart Inc. and other American retailers are also on the list of targets as winter approaches. Chinese watches and jewelry might be next, likely putting pressure on companies such as Fossil Group Inc., which relies on Chinese factories to supply many of its timepieces and specialty items.
In the Pockets
Apple Inc. warned of higher prices on Apple Watches and AirPod headphones if proposed U.S. tariffs on $200 billion worth of Chinese goods kick in. A range of speakers and earphones and more Apple products -- from iPhones to iPads -- could see higher price tags if additional levies are imposed. The company is deeply dependent on Foxconn Technology Group and other suppliers with operations in China for iPhones and other products. “All tariffs ultimately show up as a tax on U.S. consumers,” Cupertino, California-based Apple told the Office of U.S. Trade Representative in a letter this month.
Below the Belt
America imports more women’s underwear from China than from any other country. Last year, Made-in-China bras, girdles, corsets, suspenders and garters sent to the U.S. were worth $1.2 billion, according to trade data. Even budget-conscious American men in the market for underwear and briefs may be out of luck: China is the biggest supplier of those, too. Victoria’s Secret and Hanesbrands Inc. may see costs for many of their intimates rise.
Shake a Leg
It may be time to change workout gear. Gym attire from Under Armour Inc. at Foot Locker and Lululemon Athletica Inc. stores will become dearer if Trump is true to his word. The same goes for the $1.3 billion of pantyhose, socks and other legwear sent to the U.S. from China last year.
On the Run
Former San Francisco 49ers quarterback Colin Kaepernick might get a good deal on Nike sneakers with the company’s new ad campaign. The rest of us may have to pay more for running, tennis or soccer shoes. About $11.5 billion of footwear from China was shipped to the U.S. last year. Getting to work in a downpour will become more expensive with a tax on Chinese rubber boots. And Chinese-made insoles may cost more, too.
©2018 Bloomberg L.P.