One of the expressed objectives of President Donald Trump regarding tariffs has been to bolster domestic manufacturing.
However, the overarching goalsâand the sectors the president aims to influenceâhave sometimes appeared unclear. Trump appears to be particularly focused on competing with China, promoting U.S. production, and negotiating advantageous deals with other nations. As ongoing negotiations unfold, what has been the real effect on domestic manufacturing?
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During Sourcing Journal’s annual Fall Summit, industry leaders including Joseph Ferrara, co-founder and CEO of Ferrara Manufacturing; Sheng Lu, professor and graduate director of fashion and apparel studies at the University of Delaware; and Bill McCann, executive director of the United States Footwear Manufacturers Association (USFMA), participated in a panel moderated by Kate Nishimura, senior news and features editor at Sourcing Journal, to analyze the future of U.S. manufacturing.
A significant portion of the dialogue focused on the impact of Trump’s occasionally confrontational approach toward China concerning nearshoring and onshoring. While tariff rates have stabilized for the time being, Trump previously imposed a triple-digit tariff on imports from China, which unsettled brands and retailers heavily reliant on Chinese production. However, Lu noted that this has not yet resulted in increased U.S. exports or manufacturing, according to his data.
Lu attributed part of the stagnation to the capabilities gap between domestic factories and those in China, which have developed extensive capacities over recent decades.
“To position yourself as an alternative to China, you must provide a similar range of products that they currently offer. However, itâs essential to recognize that China is not merely a source for T-shirts or basic goods for U.S. companies. Instead, they procure a wide variety of itemsâsomething Western hemisphere suppliers struggle to match,” Lu explained.
He further elaborated that the swift implementation of Trumpâs tariffs has created a rush for brands and retailers to rethink their traditional sourcing strategies. While a growing number of companies express interest in shifting towards U.S.-made products, the limited scalability of certain items complicates the decision for bulk purchasing.
“Approximately two-thirds of apparel manufacturers in the U.S. operate with fewer than 10 employees. In contrast, factories in Bangladesh and Vietnam typically boast workforces of 1,000, 2,000, or even 5,000. My point is that while domestic factories excel in prototyping and sampling, they face substantial limitations when scaling up production,” Lu said.
