Nike Raises Prices To Offset Tariff Impacts

Nike (NKE) plans to raise prices on a wide range of sneakers and athletic wear as the company moves to offset the impact of tariffs.Prices for Nike apparel and equipment for adults will increase by $2 U.S. to $10 U.S., while footwear priced between $100 U.S. and $150 U.S. will see a price hike of $5 U.S. Sneakers that sell for more than $150 U.S. will see a $10 U.S. increase. The price increases will go into effect by June 1 but could be seen on store shelves as soon as this week. The increases cover a large portion of Nike’s products, including its signature running shoes.Nike said it is reserving the price increases for adult footwear and athletic apparel. The prices charged on children’s products will not increase, nor will items priced below $100 U.S. The company does not want to risk alienating families or face a consumer backlash among cash-strapped parents, especially during back-to-school shopping this summer.Additionally, Nike’s popular Air Force 1 sneaker will remain priced at $115 U.S. Michael Jordan branded apparel and accessories won’t see any price increases, but Jordan sneakers will, according to the company. Nike manufacturers about half of its footwear in China and Vietnam, which U.S. President Donald Trump has hit with steep import duties. Chinese goods face a 30% tariff, while imports from Vietnam are currently subject to a 10% duty. Tariffs are expected to hit Nike’s profit margin in coming quarters, and the company can offset that impact by raising prices. The stock of Nike has declined 19% this year to trade at $60 U.S. per share.