Trump's new tariff has given the biggest blow to this company!
Whenever there is talk of good shoes in India, Nike shoes are definitely mentioned. The shoes of this company are a bit expensive, that is why its shoes are mostly seen on the feet of rich people. However, now Donald Trump's tariff has given a big blow to this company. This is the reason why the shares of this company fell by 6 percent on march 3. Let's know how US President Donald Trump's decision has created problems for Nike.
Tariff is not good for Nike
US President donald trump imposed an additional tariff of 46 percent on goods imported from vietnam on the occasion of "Liberation Day". This decision has led to a huge decline in the shares of big sports goods manufacturing companies, especially Nike. According to a Bloomberg report, 50 percent of Nike's shoes and 28 percent of clothes are made in Vietnam. Similarly, 39 percent of Adidas shoes also come from there.
Why is vietnam so important?
In fact, big brands produce in vietnam due to low labor cost, skilled workforce and better transport infrastructure. But trump targeted vietnam due to its $123.5 billion trade surplus with the US.
Fall in Nike shares
After Trump's decision, Nike shares fell by 6.4 percent on Thursday. This happened at a time when Nike was already losing market share to new brands like On and Hoka.
The company's CFO Matt Friend had warned last month that revenue would fall further in the next quarter. In march, Nike shares have fallen by 20 percent.
Impact on china and cambodia too
Not just vietnam, heavy duties have been imposed on imports from china (34 percent tariff) and cambodia (49 percent tariff). Shares of Nike's supplier Shenzhou international in hong kong fell 18 percent, the biggest fall in the last three years.
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