If President-elect Donald Trump has made anything clear about what he plans to do once he takes office, it's that he wants to make some changes to trade.
More specifically, he's in opposition to the Trans-Pacific Partnership, a trade agreement among 12 Pacific Rim countries designed to facilitate the movement of goods among them.
The TPP has been a hotly contested trade issue for years, championed by President Barack Obama as an agreement to increase wealth in the US by opening up Asian markets to American goods. Critics say it would endanger American workers by tempting companies to outsource their factories to Asia.
A vote on the deal has still not be held in Congress, and its future is now largely in doubt since Trump's historic election victory. Internal documents from Trump's transition team obtained by Politico reportedly say pulling out of the deal will be at the top of Trump's agenda in his first 100 days.
A large percentage of footwear is made in countries included in the TPP pact. Why does that matter for sneakers? Tariffs are high for footwear, ranging from 5% to 40% depending on the materials used, according to the Office of Textiles and Apparel.
About 97 to 99% of sports footwear sold in the US is made elsewhere, accounting for nearly $3 billion in tariffs paid, according to the pro-trade organization Footwear Distributors and Retailers of America. Nearly half a billion dollars of that comes from TPP countries, chiefly Vietnam and Malaysia.
China — which, with 66% of inventory, is the largest exporter of shoes to the US — was not involved in TPP negotiations. The second-largest exporter, Vietnam, was.
TPP would reduce or eliminate tariffs for shoes imported from Vietnam and some other countries into the US, reducing the built-in cost to outsource sneaker manufacturing overseas.
This would potentially reduce the cost of sneakers in the US, according to NPD group analyst Matt Powell, and an increase in sports shoe sales overall.
The players
Nike, the largest sportswear maker in the world, made no secret of the fact that it was in support of TPP. It has 26 footwear factories in Vietnam, the majority of which create shoes for the American market. The swoosh promised to bring up to 10,000 jobs to the US should the pact be approved and put into action. Nike said a reduction in tariffs could be used toward more advanced manufacturing.
The German sportswear giant Adidas also supported the deal for similar reasons.