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China's Wholesalers See U.S. Buyers Slip Away; How America Lost Manufacturing Crown By Mark R. Long

The world's largest wholesale market has 75,000 vendors across an area bigger than 1,000 American football fields. What it doesn't have now: crowds of U.S. buyers snapping up everything from toys, to hats, to leggings.

The WSJ's Yoko Kubota visited the famous Yiwu market in eastern China's Zhejiang province and writes that vendors there are confident they can weather ballooning U.S. tariffs, sustained by other buyers. But they were perplexed , wondering where Americans would get their sparkly keychains, ballcaps, thermoses...and socks. China accounted for 56% of all sock and stocking imports to the U.S. in 2023. One district of the nearby city of Zhuji produces some 25 billion pairs of socks a year.

Lowering their prices to offset 145% American tariffs-paid by importers-wouldn't be feasible for sock makers because they are such low-margin items. This means the importers will need to cut into their profits, ask U.S. customers to pay more, or find another country to buy low-cost socks. This isn't impossible, as Pakistan, Honduras, El Salvador and other countries make lots of socks. But China's prices and speed, backed by an army of skilled workers, are hard to beat.

China's exports surged in March as shipments were likely front-loaded before tariffs kicked in, but they are expected to falter in the coming months.(WSJ) Nvidia said it would start manufacturing AI supercomputers entirely in the U.S., a day after Trump said tariffs are coming for semiconductor imports. (WSJ) Chinese leader Xi Jinping called for stronger trade and supply chain ties with Vietnam at the Hanoi signing of cooperation pacts between the two nations. (Reuters) Japan is reviewing nontariff trade barriers opposed by Trump, including regulations on auto and agricultural products. (Nikkei Asia) Asian manufacturers are racing to secure enough containers and shipping slots to move goods out during the 90-day tariff pause. (The Loadstar) FedEx will charge a $0.45-a-pound demand surcharge for parcels from China, Hong Kong and the Philippines. (Supply Chain Dive) Apparel-import bookings into the U.S. plunged 59.1% from the previous seven days in the week ended April 6, according to Vizion. (Sourcing Journal) CONTENT FROM: PENSKE LOGISTICS Gain the Big Picture. Gain Ground with Penske Logistics.

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Not Made in America

Trump says his sweeping tariff regime is aimed at bringing manufacturing back to the U.S. Economists are skeptical that tariffs could make that a reality, and worry that the damage they create will outweigh any benefits.

The Journal's Justin Lahart lays out how the U.S. lost its place as the world's factory powerhouse , with 9.4% of private-sector jobs in manufacturing, down from 35% in the 1950s. Growing wealth and education shifted domestic demand and investment toward services, and factory jobs leveled off while services jobs grew from the mid-1960s through early 1980s. Meanwhile, less-developed countries started picking up low-cost production slack. This intensified in the 1990s with the North American Free Trade Agreement, and then shifted completely once China joined the World Trade Organization in 2001. By 2008, China surpassed the U.S. as the world's No. 1 exporter of goods. Meanwhile, the U.S. took command of the global market for services, and now exports over $1 trillion of services a year. Quotable Autonomous Transport

Kodiak Robotics is merging with blank-check company Ares Acquisition Corp. II, an affiliate of Ares Management, to go public in a deal that values the self-driving truck startup at about $2.5 billion. The WSJ Logistics Report's Liz Young writes that the combined company, founded in 2018 by industry veteran Don Burnette, would be called Kodiak AI. It makes AI-powered software used to outfit existing trucks with self-driving technology.

Number of the Day In Other News

OPEC cut its forecast for oil demand growth days after deciding to boost output, citing the impact of U.S. tariffs. (WSJ)

The European Central Bank is set to lower its key interest rate Thursday to help cushion the eurozone economy against the trade-war uncertainty. (WSJ)

The share of German exports to the U.S. reached 10.4% last year , its highest level since 2002, though that uptick could be short-lived. (WSJ)

Singapore's central bank eased policy settings again as the city-state braces for a sharp economic slowdown. (WSJ)

Volkswagen's Audi and Porsche brands are recalling thousands of vehicles in the U.S. due to various software problems. (WSJ)

Intel will sell a majority stake of its programmable-chip unit, Altera, to private-equity firm Silver Lake. (WSJ)

BP discovered oil at the U.S. Far South prospect in the Gulf of Mexico, about 120 miles off the Louisiana coast. (WSJ)

LVMH posted quarterly revenue below expectations as the trade war between two of the luxury sector's biggest markets heated up. (WSJ)

Mediterranean Shipping founder Gianluigi Aponte is a key investor in the BlackRock-led deal to buy 43 ports-including two on the Panama Canal-from Hong Kong's CK Hutchison. (Bloomberg)

Ocean carriers on the eastbound trans-Pacific are poised to blank more voyages , with some ships departing China half-empty through May. (Journal of Commerce)

Japan's Nippon Yusen Kaisha is merging three of its dry-bulk shipping and ship-management units into NYK Bulkship Partners. (Splash 247)

Singapore's Vasi Shipping initiated insolvency proceedings after container freight rates plunged. (TradeWinds)

Three South Korean crane makers are considering opportunities in the U.S. market. (World Cargo News)

Investment firm Stonepeak acquired Air Transport Services Group in an all-cash deal with an enterprise value of about $3.1 billion. (Air Cargo News)

BNSF Railway and the SMART-TD Yardmasters reached a tentative , five-year collective bargaining agreement. (Trains Magazine)

About Us

Mark R. Long is editor of WSJ Logistics Report. Reach him at [mark.long@wsj.com]. Follow the WSJ Logistics Report team on LinkedIn: Mark R. Long , Liz Young and Paul Berger .

This article is a text version of a Wall Street Journal newsletter published earlier today.

(END) Dow Jones Newswires

April 15, 2025 07:06 ET (11:06 GMT)

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