Apparel brands grappling with 'tariff hell,' says Canadian industry group

Paula Duhatschek · CBC News

· Posted: Apr 08, 2025 4:00 AM EDT | Last Updated: 9 minutes ago

Canadian manner brands are grappling with the interaction of Washington's steep caller tariffs connected garment-making hubs similar China, India and Vietnam.

"One of my members called this 'tariff hell,'" said Bob Kirke, enforcement manager of the Canadian Apparel Federation.

Retail groups successful the U.S. person likewise warned that tariffs connected Asian countries, wherever astir American covering is manufactured, volition mean a steep uptick successful prices up of the back-to-school season. 

While the Canadian apparel assemblage wasn't targeted straight by the tariffs, galore companies headquartered present marque their products overseas and merchantability to customers southbound of the border.

Canadian retail giants similar Aritzia, Lululemon and Gildan saw their banal tumble aft the tariffs were announced past week by U.S. President Donald Trump.

Access to the U.S. marketplace is captious for brands successful this state if they anticipation to turn past a definite point, says Emma May, laminitis of the Calgary-based womenswear marque Sophie Grace.

"The U.S. market's amazing, it's huge," said May, who has customers connected some sides of the border. "We lick the aforesaid occupation for the U.S. lawsuit that we lick for a Canadian lawsuit and determination are 10 [times arsenic many] of them." 

But May is starting to reconsider immoderate of her U.S. enlargement plans. 

Her apparel are made successful China and warehoused successful Canada, wherever they are shipped to U.S. e-commerce customers. On apical of an further 34 per cent tariff connected Chinese goods imposed past week, the White House has besides said a erstwhile exemption, that allowed small orders from China into the U.S. without tariffs, is closing.

"Maybe the U.S. marketplace is conscionable not thing we tin spell astatine due to the fact that our products volition extremity up being conscionable acold excessively costly for that customer," said May. 

It's improbable the U.S. volition let loopholes for Chinese-made products that marque a pit halt successful Canada earlier being sold successful the U.S., says commercialized lawyer John Boscariol.

The Trump medication "is trying to adjacent up immoderate loophole oregon imaginable exemption," said Boscariol, a spouse with McCarthy Tetrault successful Toronto.

And portion covering is simply a premier example, Boscariol says galore Canadian businesses are apt dealing with the aforesaid problem.

"Whether you're successful clothing, apparel items, toys, whatever... whether that's China, Vietnam oregon immoderate different state successful Asia that's present been targeted with precise important tariffs, you're going to beryllium impacted by this successful presumption of your entree to the U.S. market."

Why not alteration factories? 

Jeremy Oldland, co-owner of the Montreal kids covering institution Hatley, manufactures his products successful China and India. He supplies pint-sized rainfall boots, pajamas and jackets to section stores, boutiques and e-commerce customers southbound of the border. 

U.S. income marque up astir fractional his revenue, says Oldland, and helium expects that imposing a caller surcharge connected each those orders will spur a question of cancellations. 

"We're going to merchantability little product. It's going to wounded immoderate mode you bash it," helium said. And yet shifting proviso chains retired of Asia to North America would beryllium difficult.

"We don't person the tradesmanship, the craftsmanship, we don't person the printing techniques, we don't person a batch of things [in Canada]."

Kirke, with the apparel federation, says the caller tariffs are hitting the manufacture peculiarly hard due to the fact that they look to travel retired of near field. 

In caller years, increasing commercialized tensions betwixt the U.S. and China person prompted immoderate larger retailers to commencement shifting production outside of that country, a determination that was besides driven successful portion by reports of forced labour successful China's Xinjiang region.

But now, the U.S. is besides going aft smaller manufacturing hubs similar Vietnam, Cambodia and Bangladesh, wherever companies had antecedently been trying to diversify their production. 

"That's a hard, hard happening to woody with," said Kirke.

Kirke says he is gladsome that the U.S. tariffs don't deed Canadian-made products, though this is simply a comparatively tiny information of the full industry.

The hope, helium says, is that Trump volition change course and back down connected his tariff policy.

As for May, with the marque Sophie Grace, she hopes to proceed increasing her concern — but with an accent connected customers northbound of the border. 

"We volition evidently beryllium looking to retrench successful the Canadian marketplace and past besides research different markets similar Australia and Europe," she said.