BEAVERTON – Global sportswear giant Nike has announced plans to significantly reduce its dependence on Chinese manufacturing for the U.S. market, citing rising import tariffs as a key financial burden.
According to the company, the shift is part of a broader supply chain diversification strategy. Currently, around 16 percent of Nike’s U.S.-bound footwear is produced in China. The firm now aims to bring that figure down to the high single digits by the end of fiscal year 2026.
Nike’s Chief Financial Officer Matthew Friend stated that U.S. tariffs on Chinese imports are expected to cost the company approximately $1 billion, terming it a “meaningful cost headwind.” He added that the company is implementing a multi-pronged strategy to mitigate the impact.
Strategic Adjustments Underway
To cushion the effects of increased duties, Nike will:
- Shift production to alternative markets, including Vietnam and Indonesia;
- Introduce targeted price increases in the U.S. later this year;
- Continue internal cost-cutting to absorb additional expenses.
The company’s announcement comes amid broader trade tensions between the U.S. and China, as well as renewed focus on supply chain resilience among multinational firms.
Market Response Positive
Investors responded favourably to Nike’s strategy, with shares rising more than 15% following the announcement. Market analysts credit the company’s renewed focus on core sports innovation and streamlined operations for restoring investor confidence.
Nike’s move aligns with a growing trend among U.S.-based corporations aiming to reduce reliance on Chinese manufacturing in response to evolving geopolitical and trade dynamics.
This story has been reported by PakTribune. All rights reserved.
