For Adidas, the move to Vietnam was supposed to be the smart play. It wasn’t.
The sportswear giant shifted heavy production to Southeast Asia to dodge earlier trade friction — and for a while, it worked. Now Washington has slapped a 46% punitive tariff on Vietnamese imports, and Adidas finds itself holding the bag on 27% of its entire global procurement volume, spread across 70 supplier facilities in the country.
Why it can’t just pack up and leave:
- Nearby alternatives are no safer: Indonesia faces a 32% tariff, India 26%, and Cambodia a steep 49%
- High-performance footwear manufacturing requires highly specialised capabilities — you can’t retrain a factory overnight
- Many retail contracts are already locked in, meaning any price increases won’t reach consumers for at least six months
Adidas, alongside Nike and others, has formally petitioned the White House for an industry-wide exemption. The Footwear Distributors & Retailers of America has called the reciprocal tariffs an “existential threat” to the US shoe industry — strong words from a group not known for drama.
Counting the cost
The financial hit is already baked in. Adidas now targets €2.3 billion in operating profit for 2026 — roughly 15% below the analyst consensus of €2.72 billion. CFO Harm Ohlmeyer put it plainly: without the tariff burden and a weaker US dollar, the company would have hit a 10% EBIT margin this year. That goal has been pushed to 2027/2028.
All eyes are on the quarterly report due April 29, which will be the first real window into how badly tariffs and currency headwinds are squeezing gross margins.
Looking ahead…
Despite the bruising outlook, 22 out of 23 analysts still rate the stock a buy — with UBS maintaining a €219 price target and calling the recent share price slide (the stock is trading ~55% below consensus target) an overreaction. Whether they’re right depends a lot on how quickly Adidas can diversify its supply chain and whether Washington gives the footwear industry any relief. Neither looks like a quick fix.