Amid New tariffs, some US Companies are rethinking their exit from China
Fresh US tariffs are reshaping supply-chain decisions for companies that have spent the past several years trying to reduce their China exposure. Since President Donald Trump announced a new round of tariff action on April 2, 2025, several US firms and industry groups have said the new trade costs are pushing them to reconsider how fast they can move production elsewhere.
Companies are slowing, not reversing, some moves
Furniture maker Lovesac said on its June 2025 earnings call that it was reassessing the pace of its sourcing shift because tariffs now apply across multiple countries, not just China. Chief executive Shawn Nelson said the company had previously expected to cut China sourcing to about 3% by the end of fiscal 2027, down from roughly 35% in fiscal 2024. After the April 2 tariff changes, he said the company was taking a broader look at cost, timing, and supplier capacity.
Steve Madden made a similar point in May 2025, when executives said on the company’s earnings call that the new tariffs complicated earlier plans to move production to Cambodia, Vietnam, and Mexico. The company had already reduced its imports from China by about 45% since November 2024, according to company statements. Even so, executives said China remained hard to replace quickly because of its scale and established factory network.
What this means in the US, including ports and prices
The immediate US impact is showing up less in factory towns and more in import planning, freight contracts, and retail pricing. At the Port of Los Angeles, Executive Director Gene Seroka said in April 2025 that importers were revisiting shipping schedules after the tariff announcement, with some cargo delayed while companies recalculated landed costs. The port has not released a company-by-company list of affected shipments.
What is not yet known is how many US jobs or store prices will be directly affected by these delayed exit plans. The National Retail Federation said in April 2025 that tariffs function like a tax on imports, but it did not provide a state-by-state estimate tied specifically to companies slowing their China moves. For shoppers, the near-term effect could be steadier product availability in some categories, even if sourcing shifts take longer than expected.
Why China still matters and what comes next
China’s role remains difficult to unwind because of logistics, supplier density, and speed. A 2025 report from the US-China Business Council said many member companies still rely on China for components, finished goods, or both, even when they are adding production in India, Vietnam, or Mexico. The group said diversification was continuing, but a full exit often remained too costly or too slow.
That helps explain why companies are rethinking timelines rather than abandoning strategy. Goldman Sachs analysts wrote in an April 2025 note that broad tariffs can reduce the advantage of moving from one low-cost country to another if duties rise across several sourcing markets at once. For US consumers, that means more companies may keep a foothold in China while building backup production elsewhere, a pattern that executives described throughout the spring 2025 earnings season.
