For decades, the fashion industry has thrived on a globalized supply chain to keep production costs low and profit margins high. However, escalating trade tensions between the U.S. and China now threaten to unravel this model. On February 1st, 2025, as part of an ongoing trade war, the U.S. imposed sweeping tariffs on Chinese imports, including a 10% tax on all goods and an additional 25% tariff on aluminum and steel. Given that China is responsible for supplying nearly 36% of all U.S. apparel imports and over 50% of global textile production, these tariffs have sent shockwaves through the fashion industry.
Designers, brands, and retailers now face a difficult reality: higher costs for materials and production, uncertainty in supply chains, and the possibility of passing those costs onto consumers. While some policymakers argue that these tariffs will encourage American manufacturing, industry experts warn that the U.S. lacks the necessary infrastructure and labor force to support large-scale domestic production. In the meantime, fashion brands must navigate these rising costs and shifting trade dynamics, all while trying to keep their businesses afloat.
Manufacturers that produce in China have limited options for relocating their operations. Naika Colas, Sustainable Design Strategist at Parsons School of Design and founder of the Eco-Friendly Fashion brand, argues that most fashion graduates aim to be designers, not factory workers. American workers demand higher wages and more prestigious positions than those offered by factories abroad. This keeps manufacturers facing China’s retaliation policies.
In response to Trump’s tariffs, China may impose retaliatory levies on U.S. goods, making it more expensive for American companies to do business there. Additionally, the Chinese government has placed major U.S. fashion brands, such as the parent company of Tommy Hilfiger and Calvin Klein, on its “unreliable entities list.” This designation could result in restricted market access, supply chain disruptions, and even forced closures of retail stores and manufacturing facilities in China–one of the world’s largest consumer markets.
Beyond direct trade measures, China may also encourage its domestic brands to prioritize local suppliers over American companies, further squeezing U.S. businesses that rely on the Chinese market for both production and sales. These moves could intensify economic uncertainty, leaving U.S. fashion brands scrambling to either find alternative suppliers in other countries like Vietnam or absorb the financial burden of these increased production costs, ultimately leading to higher prices for consumers.
The long-term effects of the U.S.-China trade war on the fashion industry remain uncertain, but one thing is clear: brands must adapt to a rapidly changing global landscape. As tariffs drive up production costs, companies must decide whether to continue relying on China, shift their supply chains to other countries, or attempt to manufacture domestically. Meanwhile, consumers may face higher prices on clothing, forcing them to rethink their shopping habits or turn to alternative markets such as resale and second-hand fashion.
With the fashion industry at a crossroads, critical questions remain: Can American brands find cost-effective alternatives to China? Will shifting supply chains lead to long-term price stabilization? And is the U.S. realistically capable of rebuilding its textile industry to meet demand? The answers to these questions will shape the future of global apparel production and determine how fashion brands navigate this evolving trade environment.
