14 April 2025
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New tariffs introduced by US president Donald Trump are shaking up international trade once again. The United States has imposed import duties on goods from over 100 countries, with key players in the fashion supply chain such as China, Vietnam, Bangladesh, Cambodia suffering from the highest tariff rates. However, on April 9th, the US president announced a 90-day ‘tariff pause’ for all countries with nation-specific tariffs, except China. One thing is sure: nothing is certain anymore in the global fashion industry.
What is a tariff?
A tariff is a tax applied to imported goods. For example, if jeans imported from China normally cost $20, a tariff of 100% would mean that an additional $20 is added to the cost. The product would then enter the US market at $40 – without any value added to the item itself.
What’s unclear, however, is who will absorb this extra cost. In many cases, suppliers in exporting countries such as China, Vietnam, and Bangladesh are expected to carry at least part of the burden. But for these suppliers, already operating with razor-thin margins, this could be a heavy blow – especially for those producing low-cost goods for large fast fashion brands.
Fashion is deeply global – and vulnerable to trade disruptions
Fashion is one of the most globally interconnected industries. A single garment might be designed in France, assembled in Bangladesh, dyed in China, and packaged and sold in the US.
According to data from the Yale Budget Lab, leather goods and clothing are the product categories expected to see the highest price increases – 18% and 17% respectively. For many brands, this means higher costs and complex decisions about where and how to produce in the future.
Who will be impacted the most?
American retailers and global brands
Large retailers like Zara and Puma, which depend on international supply chains, are already feeling the pressure. Several have seen their stock prices fall as a result of investor uncertainty. Yet, from the moment president Trump announced the ‘tariff pause’, stock prices skyrocketed again. Currently, it is uncertain how these large brands will be affected in the long and short term.
If the steep tariffs come through in the Asian countries that are important to the fashion industry, American retailers will try to protect their profits by pushing some of the cost increase back down the chain – to their suppliers. It is, however, likely that their products will become more expensive in the US.
Suppliers and garment workers
(a part of) the pressure of the extra cost is likely to be passed on to suppliers and eventually to factory workers, particularly in low-wage countries. Most already operate in challenging environments, with little bargaining power. With retailers demanding lower prices despite higher production costs, working conditions and wages could deteriorate even further.
American designers and small brands
While some argue that US-based designers may see this as a chance to promote locally made clothing, the reality is more complex. The US lacks the workforce and infrastructure to replace the vast volumes of apparel it imports. Producing garments entirely in the US remains expensive and logistically difficult.
European brands and the luxury segment
European brands that export to the US will also feel the squeeze, particularly those in the luxury fashion sector. With increased costs and potential retail price hikes, European-made goods may become less competitive in the American market. This could lead to a surplus of high-end fashion in the EU, intensifying competition locally.
Are there any positive outcomes?
While these tariffs bring disruption, they could also accelerate shifts already underway in the industry.
One possible outcome is the growth of the secondhand clothing market. As new clothing becomes more expensive, more people may choose pre-owned fashion – a move that supports circularity and reduces textile waste. However, there is a risk that secondhand may become the only accessible option for lower-income groups, potentially widening the gap between high- and low-income consumers.
There is also space for local innovation and upcycling. Independent designers and small brands working with pre-loved or deadstock materials could find new opportunities in a market looking for alternatives to conventional fast fashion.
Many experts agree, however, that the positives do not outweigh the large impact the tariffs could have on American citizens, global business and garment workers.
The EU response: retaliation or opportunity?
In response to Trump’s tariffs, the European Union has announced its own countermeasures on April 9th, planning to impose tariffs on up to €22 billion worth of US goods, including jeans, coffee, steel, and motorcycles. On April 10th, however, president of the European Commission Ursula von der Leyen announced that the EU will also pause their counter-tariffs for 90 days in anticipation of negotiations.
While counter-tariffs could increase prices on certain American products in Europe, it may also stimulate local production and reduce dependency on US imports. In the long run, this could support more regional, transparent, and potentially more sustainable supply chains.
Needless to say, a global trade war is not desirable either. Shortly after the EU’s announcement, Trump threatened a 200% tariff on EU alcoholic beverages, showing how quickly trade disputes can escalate into full-blown trade wars. For now, the line between protectionism and economic retaliation is thin, and both sides are watching carefully.
Time to explore more local alternatives?
As American products become more expensive in Europe, now might be the moment to rethink your go-to fashion brands. Whether you’re trying to reduce your carbon footprint or simply want to support more ethical supply chains, here are some great European alternatives to look into:
Leave Levi’s behind
Jeans are a staple of American culture, but Europe has plenty of excellent, more environmentally conscious alternatives. Discover European brands that offer high-quality denim with more transparent and responsible production processes.
Discover jeans alternatives for American fast-fashion brands
Neglect Nike (and Adidas, Puma, …)
Famous American sportswear brands might be top of mind, but many fall short on labour rights and environmental impact. Thankfully, Europe offers a range of more responsible and transparent options – without compromising on performance or style.
Find sportswear brands that prioritise good working conditions
Part from Patagonia
Some US outerwear brands have made steps towards sustainability, but they’re not the only ones. Europe is home to brands that offer quality outdoor gear with just as much durability, but a stronger focus on transparency and ethics.
Avoid Victoria’s Secret
While some well-known US labels have faced criticism for unsustainable practices and lack of inclusivity, many European lingerie brands are leading the way with body-positive designs, local craftsmanship and responsible materials such as organic cotton and recycled lace. These brands often prioritise transparency, fair working conditions and innovative design, offering a refreshing alternative to mass-produced, fast fashion underwear.
COSH!’ naughty list of 2024
There are several brands that did not do it quite right in 2024. Do you want to find out the scandals surrounding several popular brands? Also note how many of these companies are based in the US…
Trump’s new tariff policy is already sending waves through the global fashion supply chain – raising prices, pressuring suppliers, and prompting major brands to rethink their strategies. For the EU, this is both a challenge and a potential opportunity. If managed carefully, it could lead to more local production, stronger regional markets, and a push towards fairer, slower fashion.
But let’s be realistic. These shifts could also widen the affordability gap, put more pressure on already vulnerable workers, and spark prolonged trade tensions. As consumers, brands, and policymakers, we have a role to play in making sure the next phase of fashion is not only more local, but more just and inclusive too.
