Top Stories
Top Stories
Wires

UPDATE 1-Crocs to slash Chinese production for U.S. market

(Adds details from statement, background)

June 11 (Reuters) - Crocs Inc will aim to cut the volume of its shoes and accessories produced in China for the U.S. market by more than two-thirds over the next year, as it guards against the impact of President Trump's trade war with Beijing.

The casual footwear maker's rubber designs have made it a hugely popular choice over the last decade among older Americans looking for functional footwear for gardening or the beach, and have also become trendy in the past year with millennials as ironic "ugly" fashion.

In a press release ahead of an industry conference on Tuesday, the company said it would produce less than 10% of products for the U.S. market in China by 2020, compared to about 30% currently.

It also said it will only have to wear costs of $5 million over the next year, assuming a 25% tariff takes effect on Aug. 1.

"Our current sourcing mix reflects our need to balance ramping up incremental supply to meet the growing demand for our product and continuing our multi-year effort to reduce our sourcing from China," the company said on Tuesday.

Crocs said it is also evaluating other plans to soften the impact of potential tariffs.

Last month, footwear companies including Crocs, Nike Inc and Under Armour, urged Trump to remove footwear from a proposed list of additional tariffs that would impact $300 billion worth of Chinese goods.

The company on Tuesday added that due to these efforts, Crocs does not anticipate that the potential tariffs will have a "material adverse impact" on its business. (Reporting by Aishwarya Venugopal in Bengaluru; Editing by Arun Koyyur and Shailesh Kuber)

Related Tags