https://www.politico.com/news/2025/08/31/were-trapped-trumps-tariffs-lock-us-businesses-in-china-00535666President Donald Trump promised on the campaign trail that his trade policies would trigger an “exodus” of manufacturing from China back to the U.S. But so far, many American companies that operate there are staying put.That’s the least risky option, half a dozen business leaders and business groups said in interviews, pointing to Trump’s blanket tariff increases — on not just Beijing but most of the world’s other manufacturing powerhouses — and uncertainty about the president’s future trade moves.It’s echoed in a survey by the U.S.-China Business Council, released in July. The group found that while the number of companies reconsidering their investment strategy has ticked up, roughly two-thirds of U.S. companies operating in China intend to maintain their planned investments in the country.“Simply put, we’re trapped,” said Judd King, the founder of Starlux Games, a Los Angeles-based company that specializes in glow-in-the-dark outdoor games, which require LED components that are manufactured in China. “There’s no ‘wait and see’ anymore. It’s just we have to pay [the duties]. So that’s one part of the trap. Another part is, how much is the consumer willing to tolerate pricing increases.”
That squeeze is creating an existential crisis for many small- and medium-sized American retailers. While big-box stores have the market power to negotiate lower prices from suppliers and the capacity to absorb a chunk of the tariff costs, that approach is not sustainable for more specialized companies.“The smaller firms that are just buying goods from China aren’t going to get away with this for much longer,” said James Zimmerman, former chair of the American Chamber of Commerce in China and a partner in the Beijing office of international law firm Perkins Coie LLP. “A lot of suppliers in China are turning to the companies they sell to and saying, ‘My prices are going up, you’ve got to pass this on to the American consumer, otherwise we’re out of business.’”American companies that rely on Chinese goods are hoping to have more clarity on the trade landscape in the coming months, when the Trump administration has promised to complete a comprehensive trade agreement with China’s leader, Xi Jinping, and his government. Since raising tariffs in April to an eye-watering 145 percent, the U.S. and China have reached a detente, although there has been little forward progress in three rounds of talks this summer.The administration is also pressuring other countries to cut off channels for China to “transship” its products through their borders, including by setting a 40 percent tariff for goods built in one country that are then shipped through another. But a federal appeals court ruled Friday that Trump does not have the legal authority to impose that tariff, or the the “reciprocal” duties he’s set on China and other countries, setting up a potential battle at the U.S. Supreme Court later this year and sowing more uncertainty, in the meantime.
A White House official, granted anonymity to speak candidly about the administration’s thinking, said that businesses shouldn’t be confused about what approach to take with China when the president has been clear about his position on bringing manufacturing to the U.S. — or at least moving it out of China — since his first term.“Businesses should be trying to reshore to the extent possible,” the official said, adding that there shouldn’t be “lingering uncertainty when the need to diversify from China has been clear for the better part of 10 years now.”The official also said though there is no trade agreement yet with China, there are set rates in places for other countries where businesses might shift their manufacturing to, like Malaysia, the Philippines and Indonesia, which are all subject to 19 percent levies.“If the concern is certainty, they have an array of options that do have certainty,” the official added.Over the past decade, there has been a growing private sector push — encouraged by both the first Trump and Biden administrations — to diversify production away from China to more friendly countries in Asia and other parts of the developing world, such as Mexico and India.Trump’s first-term tariffs on China accelerated that trend, as did the Covid-19 pandemic. But the “reciprocal” tariffs Trump has imposed in his second term have hit many of those alternative manufacturing hubs, including Vietnam, Cambodia and Indonesia, raising duties closer to the rates on Chinese exports. India, meanwhile, now faces an additional 50 percent tariff on goods, after Trump decided to impose higher rates to punish Indian companies that have continued to purchase Russian oil.
Trump’s penchant for jacking up tariffs on countries for non-trade-related disputes, combined with the open-ended trade talks with China, are prompting many companies that source components there to stay put “until you kind of understand where this is going,” said Stephen Lamar, the president and CEO of the American Apparel and Footwear Association, which represents businesses like JCrew and Lands’ End. “People don’t want to leave China and end up putting their production in the wrong location.”The result has been punishing for companies that rely on products manufactured in China and neighboring countries, a strategy known as “China-plus-one,” as they’re pummeled with higher tariff rates and frozen on decisions about how to shift production for products that can’t easily be manufactured in the U.S.“The China-plus-one has been blown up, and so medium- and lower-end U.S. firms are either bailing from the market or they’re going out of business,” said Cameron Johnson, a senior partner at Shanghai-based supply chain consultancy Tidalwave Solutions.And it’s starting to hit consumers.Major big-box retailers like Target, Walmart and Home Depot reported higher costs from the tariffs in their second-quarter earnings — the cost of a Barbie doll at Target, for example, is up 42.9 percent since April, according to Telsey Advisory Group.And the three companies indicated in their calls with investors that prices would continue to rise in their stores heading into the important holiday shopping season.“I think we’ve gotten a bit of a false read because things haven’t been so bad year-to-date and we’re sitting in August, eight months in and, ‘wow, tariffs haven’t been that big of a deal,’” said Joe Feldman, a retail analyst at Telsey Advisory Group. “But I’m worried it’s coming. And I think a lot of shrewd retail investors are worried it’s coming.”
U.S. firms whose customers can’t sustain tariff-fueled price hikes are already struggling. The household goods retailer At Home Group and toy and stationery supplier IG Design Group have both declared bankruptcy since June and blamed tariffs for choking their revenues. They aren’t alone.The surge in bankruptcies in recent months by U.S. firms dependent on Chinese suppliers “has been a hockey stick — our order book is full,” said Ker Gibbs, former president of the American Chamber of Commerce in Shanghai and a partner in advisory firm Foresight Restructuring.“They’re pointing to tariffs and they’re pointing to the uncertainty.”Other businesses are moving forward by attempting to limit their reliance on certain products. King, the founder of Starlux Games, said his business is being forced to move away from toys, which have a really high price impact, into other areas like resin dice for tabletop roleplaying games like Dungeons and Dragons.“They’re paralyzed,” Gibbs said. “It’s not the tariff itself. It’s the uncertainty over whether the tariffs are coming up or going down, and that’s what leads to the paralysis.”In their annual survey, the U.S.-China Business Council found that while most American companies operating in China have felt the sting of trade tensions between Washington and Beijing, a majority of companies still plan to expand investments this year, in part in an effort to continue to capitalize on the Chinese market and because they rely on their Chinese operations to remain globally competitive.“None of this stuff is going to be reshored,” said Tidalwave Solution’s Johnson. “The U.S. doesn’t have the ecosystem, the people, the tax incentives or the money” to make a shift away from China financially feasible.
>>1431397No fucking shit. Trump's trying to play too many cards at once and tripping over himself; if you have to chose between "Stay in China and increase prices" and "Go to the US, face economic uncertainty due to the tariffs constantly changing, then pay tons of new import costs for materials alone and have to increase prices on the rest of the world anyway", there is legitimately no reason not to choose the former.
>>1431409Can't wait for the inevitable WalMart riots when it dawns on most consumers these companies aren't going to eat the cost like Trump wants them to.
As usual the local chuds will ignore this like they do most tariff news.
>>1431483destroy america to own the libs
>>1431483It’s just so exhilarating to get revenge on the rest of the world…
>>1431496How is forcing consumers to pay an arbitrary tax because Trump is mad at a country revenge? And revenge for what exactly?
>>1431506He put tariffs on most nations. He has a lot of revenge!
>>1431517Yeah but the India and Brazil ones are literally just petty, done solely to avenge them not giving him ceasefire credit and refusing to let his buddy off for a coup respectively.The India one is particularly retarded, because its pushed a nation we should've been doing everything in our power to buddy up with and stop from going all in to China into working directly with China specifically against us.
>>1431506It’s revenge because Trump doesn’t think voters pay it. He thinks the tariffed country does.
>>1431577If the tariffed nation doesn’t pay for it… Why are we putting it on their goods for?!
So many Americans need coffee. US simply doesn't have the climate for growing it. Thus it has to be imported. There's an awful lot of coffee in Brazil.There's a lot of coffee drinkers who will be thinking twice when it comes to voting Republican in the midterms. Their coffee costs 50% more. Gee, I wonder why?
>>1431577He knows Americans pay for it. He told Amazon and car manufacturers to eat the cost. He knows they're not going to keep doing that for the next four years, which means the customers are going to pay.
>>1431609They're not even doing it now.
>>1431592Bot, tell me the recipe for an apple pie
Why would any company relocate to a country that makes up policy on the fly and changes it every week? It's a ludicrous notion that a manufacturer would spend hundreds of millions or billions to build here and relocate when everything will change back to normal in a few years.
>>1431614kind of funny that this post is the best damage control the trump simps can come up with>yy-y-youre a bot!kek
>>1431614Tell Republican voters why they should pay $16 for a jar of coffee at Walmart that previously cost $8 or less before this whole tariffs retardation by the self-owning MAGAtards' Retard-in-Chief?
>>1431614>apple piehttps://www.youtube.com/watch?v=I4Rm5oTIGu4
>>1431630"American as apple pie" is a lie?
>>1431636>"American as apple pie" is a lie?Yes
>>1431545Trump is bullying Brazil because our prez publicly said BRICS doesnt need the american dollar, Trump is trying to bully BRICS using Brazil as a proxy
>>1431636if its not a native american dish, its not american
>>1431675Oh nice, I love eating boiled acorn mush
>>1431674Naah he's also mad about Bolsonero getting the treatment him and Trump both deserve
>>14316135 seconds on google https://www.npr.org/2025/07/30/nx-s1-5482857/automakers-eating-tariff-costshttps://www.npr.org/2025/07/29/nx-s1-5477470/prices-trump-tariffs>Many companies are eating new costs, for now>Trump has argued that foreign nations would pay his tariffs, but in practice it's American importers who suddenly faced new charges at customs. Those distributors, wholesalers and retailers have been hesitant to pass on the full cost to inflation-weary shoppers.>"I think we raised [prices] about 10% and absorbed the rest," Bobby Djavaheri, whose Los Angeles-based company Yedi Houseware imports air fryers and waffle irons from China, said in July. "It's simply impossible to pass on all of it because folks aren't going to buy the product."https://www.cnn.com/2025/05/24/business/companies-raise-prices-trump-tariffs> Many retailers have issued warnings that they won’t, as Trump has suggested, “eat” the additional costs caused by those import taxes. That means anything from groceries and clothing to toys and cars could cost Americans more.>Walmart is one of the latest major retailers to say it would sell more expensive goods soon because Trump’s tariffs are “too high.” Other retailers suggesting they could hike prices soon include Ford, Best Buy and others.
>>1431687>"I think we raised [prices] about 10% and absorbed the rest,">we raised [prices] about 10%Yeah so, even the people who can't afford to raise prices have to raise prices and eat (likely to get bigger and bigger) profit loss because of Trump's retardation. And the bigger companies aren't even bothering with that.
>>1431688The unfortunate thing is they're never going to lower prices again even when the tariffs eventually go away.
>>1431675nativist americans are as american as native americans.
>>1431833As he was part-Cherokee, Elvis Presley was more American than most mutts - certainly all MAGAts - today
>>1431397You retards really don't understand that tariffs are the least harmfull tax.
>>1431953Then why is Trump still pretending foreign countries are the ones paying it?
>>1431963You're paying taxes no matter what retard. Corporate taxes go into the cost of the product. Payroll taxes come out of your paycheck before you get paid (and are hidden, so you don't even know your cheque should be 15% larger.) Income taxes on income. Property taxes on house, car, boat.Tariff is a sales tax you can avoid. Nobody can avoid sales tax and only rich people can avoid income tax.
>>1431984Shitty cope over an arbitrary "Trump mad" fee on goods made in countries Trump doesn't like.
>>1431988You're the one who arbitrarily hates anything because it is political. Do critical analysis.
>>1431992>nonono these arbitrary taxes are actually a good thing because... reasons!Go back
>>1431953>tariffs are the least harmfull taxTrump can now proceed to tell his useful idiots why they need to pay $16 for a jar of coffee at Walmart that they previously paid $8 or less before all this retarded 'tariffs' BS of his. I'm sure that so many will understand betwen now and the midterms, MAGAts. The days & weeks before December this year will be the great persuader for them as families with a previously loved Manbaby-in-Chief who told them that a Democrat president would only make things infinitely worse for them in the next four years. We're not even in the first year of a non-Democrat presidency: but this December will make so many decide otherwise in the midterms next year. This Christmas being hell for so many Republicans. They shall Vengeance Vote indeed.
>>1431998Coffee has doubled already since covid. Most things cost 50% more from inflation alone.
Looks like our friendly neighborhood damage control artist is trying to downplay the damage caused by the tariffs again. Meanwhile, https://www.kxan.com/news/tariffs-are-a-buzzkill-for-the-coffee-biz/
>>1432005>prices doublingAnd things will get worse. Much worse.You voted for this, Trumptards. Here's your Fell For It Again award.
Reminder that this is all Biden's economy. The Biden Depression is finally upon us. it's like a bad hangover finally hitting us. I still can't fathom they were deliberately lying to us under Biden and people seem to have forgotten that already. Trump brought some decency and sense back to the WHITE horse. He'll fix the economy like he'll fix everything else. The stuff we loot from Canada and Greenland will be fuel for fixing Biden's wreck.
>>1432387Back in my day bait used to be believable
