Stephen Lamar is president and CEO of the American Apparel & Footwear Association. He provided the keynote address ‘Fashion’s Future Under 47: What we can expect at the intersection of fashion and politics for the next few years’ at the 19 November Luxury Law Summit New York. In this Q&A, Lamar spoke with Anne Gallagher about the key issues he sees in 2025.

What can we expect at the intersection of fashion and politics for the next few years?

People have been asking what will happen to the fashion industry under the Trump administration. The focus is on tariffs, but what exactly that means remains to be seen. Tariffs are bad economics because they add costs that raise prices – that is how they work. But interestingly, they are good politics as they give the impression of addressing unfair trade practices.  

President Trump will likely view tariffs through two lenses. He may use the threat of tariffs as leverage to make other deals, and he may use tariffs as an outcome. He has a lot of authority to impose a wide range of tariffs, and we expect him to use those authorities widely. But in contrast to how the president-elect operated mostly independently on tariffs in his first administration, he may get the Republican-controlled Congress to work with him to create new tariff authority and guide his plans.

One way he may work with Congress on tariffs is to extend the tax cuts, which expire in 2025 and will take centre stage next year. Imposing tariffs could be a way Trump justifies the revenue loss from expired tax credits.

For those who ask what will happen with Trump and tariffs, the simple answer is that nobody knows. Donald Trump doesn’t know and the people surrounding him don’t know. There is a huge fight right now about whether Trump’s campaign promise to impose tariffs will be executed in the most extreme way or in any way at all. Together, over the next couple of weeks or months or years, we will learn what happens.

President-elect Trump has said he will impose tariffs across the board but China will be the hardest hit with 60% to 100% tariffs. What is your take on this?

As for fashion, we will be hit hard if the 60% to 100% tariffs he proposes are implemented with China, which is the number one supplier to the US fashion industry. While there has been some diversification from China, these diversification efforts have only been able to progress so far, which means a lot of trade can still be hit if more tariffs or higher tariff rates are imposed.

Let’s look at the latest. China’s market share is about 36.4%, up from 35.9% in 2023. For footwear, market share is 59.1%, down from 61% in 2023. For travel goods, it is 48.4% down from 52.1% in 2023.

As you can see, adding to these existing tariffs would make things challenging for our industry.

You mentioned some ‘gee whiz’ facts in the fashion industry in your presentation. Can you share some of those with us?

Let me start by saying our import market share in the fashion industry is 98%. That means that 98% of what is in your closet is produced somewhere else. Now the value added of all those imports is about 70% from the United States. A lot of design and logistics occurs in the United States but the actual production doesn’t add as much value as people think. When you look at our industry from the retail price, most of that value add comes from the United States even though most of the products are physically made, produced and assembled in another country.

This has been the case for years. This tells us that these tariffs aren’t going to increase production in the United States.

When you think about what the United States imports each year, fashion represents about 5% of that by value. But if you look at the tariffs our industry generates for the US government, it’s about 25%.

What can you tell us about the existing tariff structure for the fashion industry?

Our current tariff structure has been in place for 95 years. Our industry has seen very little change in that structure over the years. And, sadly, that structure is highly regressive and misogynistic.

For example, it features what we call the ‘pink tariff’ where the rates are higher for women’s articles than for men’s. This means there is an extra $2bn burden borne by women. Similarly, the structure favours wealthier Americans in two ways. Like sales taxes, these tariffs apply to a higher percentage of lower-income Americans’ disposable income than their wealthier counterparts. Moreover, in several places, the rates are higher for items purchased by lower-income Americans than their wealthier counterparts.

Sadly, no one is talking about how to reform this misogynistic, doubly regressive tariff structure. Instead, the conversation is about how we can add to that existing structure with new, and dare I say tariffs. That said, we see this as an opportunity for Congress to start tweaking this existing structure if they are tasked with giving the president-elect new tariff-making authority.

Currently, tariffs are a top concern for the fashion industry. What other key issues does the industry need to address?

That’s correct, we’re spending a lot of time talking about tariffs, but we need to be looking at other issues like sustainability and how we are going to make this industry more responsive. New tariffs put pressure on the resources we need to reserve to finance those efforts, and we could be missing an opportunity to look at the tariff structure to help advance those very issues. For example, we could look at tariffs and say, let’s make it an environmentally-based structure with higher tariffs on high carbon goods or on goods that are not recyclable like goods in the fast fashion space.

The Luxury Law Summit London 2025 will be held on 10 June at the iconic British Museum. After a sold-out event in 2024, this premier gathering will bring together general counsel, in-house teams, founders, creatives, technologists, and industry commentators for a day of insights and networking. We are honoured to welcome back Belmond general counsel Abbi Hunt as conference chair. The Summit will explore issues including the evolving role of luxury GCs, strategies for protecting and positioning brands in a dynamic landscape, and bridging the gap between true luxury consumers and Gen Z.