'We're going to have to work extra hard' to afford clothes when China tariffs take effect - retail executive

Record ID: 1429314

  • Title: 'We're going to have to work extra hard' to afford clothes when China tariffs take effect - retail executive
  • Date: 30th August 2019
  • Summary: NEW YORK, NEW YORK, UNITED STATES (AUGUST 30, 2019) (REUTERS) PERSON WALKING WITH DUANE READ AND MASSIMO SHOPPING BAGS WASHINGTON, D.C., UNITED STATES (AUGUST 30, 2019) (REUTERS) (SOUNDBITE) (English) AMERICAN APPAREL & FOOTWEAR ASSOCIATION EXECUTIVE VICE PRESIDENT, STEVE LAMAR, SAYING: "With the tariffs take effect on September 1st, it's going to mean the biggest tax increase that we've seen on clothing, and shoes, and home textiles in a generation, if not longer. You know, in the United States, we have tariffs starting on September 1st, on Sunday. On Monday, it's Labor Day. And I guess having Labor Day the day after is appropriate, because we're going to have to work extra hard to pay all of these new taxes that we'll have to start paying for the day before." NEW YORK, NEW YORK, UNITED STATES (AUGUST 30, 2019) (REUTERS) PERSON WALKING WITH SAKS FIFTH AVENUE SHOPPING BAG WASHINGTON, D.C., UNITED STATES (AUGUST 30, 2019) (REUTERS) (SOUNDBITE) (English) AMERICAN APPAREL & FOOTWEAR ASSOCIATION, EXECUTIVE VICE PRESIDENT, STEVE LAMAR, SAYING: "You know, you look in your closet half of your shoes, or 70% of your shoes, are sourced from China. Half of those will face a 15% tariff starting September 1st, and all of them will face a tariff by the time it's December 15th. You look in your closet again, and you see your clothing, 40% of that comes from China. About 90% of that is going to face a tariff on September 1st, and the rest of that faces a tariff of 15% on December 15th. So, you're going to see pretty much everything in your closet, clothes, shoes, all of that is going to face this extra tax." NEW YORK, NEW YORK, UNITED STATES (AUGUST 30, 2019) (REUTERS) PERSON WALKING WITH H&M SHOPPING BAG WASHINGTON, D.C., UNITED STATES (AUGUST 30, 2019) (REUTERS) (SOUNDBITE) (English) AMERICAN APPAREL & FOOTWEAR ASSOCIATION, EXECUTIVE VICE PRESIDENT, STEVE LAMAR, SAYING: "Well, retailers and their partners throughout the supply chain have to make some very painful decisions. These are taxes that are going to start to be collected. It's not Monopoly money. It's real money. You have to pay the U.S. government, and it's not the Chinese, or it's not the Chinese companies that are paying these taxes. These are taxes that are paid by American companies. And it ultimately rolls up to the American consumer. Now as these taxes are hitting, some of them are hitting products that have already been exported, that are already arriving. So, you have to pay those, and you can't recover those costs by passing along the prices, but, eventually, you'll be able to pass along the prices, and, you know, people don't want to do that. They don't want to raise prices on their consumers. Some folks are going to try not to do that. Others will have no choice. But you have to pay those taxes from someplace. So, that means you're paying taxes from your investments, and from your profits, and from the salaries of your workers. You won't be able to hire as many people. Maybe you'll have to let some people go. You won't be able to make the investments and the innovations that you want to make. You'll have to change products around, so you can still meet the same price point. It's not a good situation. It's very, very bad." NEW YORK, NEW YORK, UNITED STATES (AUGUST 30, 2019) (REUTERS) PERSON WALKING WITH ALDO SHOPPING BAG WASHINGTON, D.C., UNITED STATES (AUGUST 30, 2019) (REUTERS) (SOUNDBITE) (English) AMERICAN APPAREL & FOOTWEAR ASSOCIATION, EXECUTIVE VICE PRESIDENT, STEVE LAMAR, SAYING: "Well, we've been asking the president, and we've been asking the Chinese government to return to the table, to end this tit-for-tat tariff strategy. It's not productive. It doesn't work. What does work are calm, productive conversations. In fact, both the Chinese and the president have both expressed support for a calm approach. We think that's a great idea. End these tariffs, go back to the table, strike the deal that needs to be done, and then let's move on with a healthy partnership, the kind of partnership we've had for years." NEW YORK, NEW YORK, UNITED STATES (AUGUST 30, 2019) (REUTERS) PERSON WITH MAC, ALDO SHOPPING BAGS PERSON WITH ADIDAS SHOPPING BAG PERSON WALKING WITH SAKS FIFTH AVENUE SHOPPING BAG PERSON WALKING WITH FOOT LOCKER SHOPPING BAG PERSON WALKING WITH NINTENDO SHOPPING BAG PERSON WALKING WITH BANANA REPUBLIC SHOPPING BAG
  • Embargoed: 13th September 2019 19:10
  • Keywords: tariffs retail stores Labor Day shopping U.S. President Donald Trump Chinese products retail stocks American Apparel & Footwear Association
  • Location: NEW YORK, NEW YORK, UNITED STATES
  • City: NEW YORK, NEW YORK, UNITED STATES
  • Country: USA
  • Topics: Economic Events
  • Reuters ID: LVA001AUEV8SN
  • Aspect Ratio: 16:9
  • Story Text: If proposed tariffs on Chinese goods take effect on Sept. 1, Americans will face about a 15% increase in the price of their clothes, a retail industry executive told Reuters on Friday (August 30).
    Chinese and U.S. trade negotiating teams are maintaining effective communication, China's Foreign Ministry said on Friday (August 30), less than 48 hours before U.S. tariffs kick in on an additional $125 billion in Chinese goods.
    But Steve Lamar, executive vice president of the American Apparel & Footwear Association said no deal would drastically affect the price of clothes and shows for consumers.
    "You know, you look in your closet half of your shoes, or 70% of your shoes, are sourced from China. Half of those will face a 15% tariff starting September 1st, and all of them will face a tariff by the time it's December 15th. You look in your closet again, and you see your clothing, 40% of that comes from China. About 90% of that is going to face a tariff on September 1st, and the rest of that faces a tariff of 15% on December 15th. So, you're going to see pretty much everything in your closet, clothes, shoes, all of that is going to face this extra tax," he said.
    "Retailers and their partners throughout the supply chain have to make some very painful decisions," Lamar said, in trying to not pass increases on to consumers.
    "You won't be able to hire as many people. Maybe you'll have to let some people go. You won't be able to make the investments and the innovations that you want to make. You'll have to change products around, so you can still meet the same price point. It's not a good situation. It's very, very bad."
    The tit-for-tat tariff war now involves hundreds of billions of dollars of each country's goods and threatens global economic growth. Uncertainty about when or how it could end has roiled markets and complicated corporations' long-term investment plans.
    The United States will begin collecting a 15% tariff on an estimated $125 billion of Chinese goods at 12:01 a.m. EDT (0401 GMT) on Sunday (September 1), including smartwatches, flat panel televisions and footwear.
    U.S. tariffs have been imposed on $250 billion of Chinese products so far since the trade war began in 2018.
    (Production: Aleksandra Michalska, Mike Wood, Kevin Fogharty, Gershon Peaks)
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