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US manufacturers are shifting their production to countries other than China, while trade tensions between the world's two largest economies have been prolonged for a second year.
Companies that manufacture Crocs shoes, Yeti coolers, Roomba vacuum cleaners and GoPro cameras are producing in other countries to avoid tariffs of up to 25% in the United States on some $ 250 billion of imports from from China. Apple Inc.
AAPL, + 0.77%
is also considering moving the final assembly of some of its devices out of China to avoid US tariffs.
Furniture Manufacturer Lovesac Co.
LOVE, -1.34%
makes about 60% of its furniture in China, compared to 75% at the beginning of the year. "We have moved our production to Vietnam very aggressively," said Shawn Nelson, general manager of Stamford, Connecticut. Nelson said that he would not consider any production in China by the end of next year.
The actions taken by US companies are resulting in a reorganization of global supply chains in the manufacturing sector as they prepare for a long period of unequal trade relations. Business executives relocating outside of China said they would like to keep them for the time and money invested in setting up new facilities and changing shipping terms. Businesses said the changes accelerated after tariffs on many Chinese imports rose from 10 percent in May to 25 percent. "Once you have moved, you do not come back," said Nelson.
A developed version of this report appears on WSJ.com.
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