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Vietnam Gains Record Share of US Apparel Imports in 2014

Apparel imports from Vietnam grew the fastest of any of the top U.S. trading partners in 2014, according to data released last week by the Commerce Department’s Office of Textiles and Apparel (OTEXA). For the year, the country gained the greatest share of U.S. apparel imports, mostly at the expense of China, which saw its dollar share of U.S. apparel imports fall from over 37 percent in 2013 to 36 percent in 2014.

Apparel imports have not grown much this year. The value of total apparel imports increased by only 2.5% in 2014, to $81.8 billion. Total unit volume, measured on a square meter equivalent (SME) basis, increased by 3.3%, driving down the average cost per SME by 0.7%.

The shift away from China was more pronounced in 2014 than in prior years. Between 2012 and 2013, China lost only half a percentage point of U.S. apparel market share, and the year before that maintained its share. However, in the past year rapidly rising wage rates in China have spurred many U.S. apparel brands to seek lower cost countries of origin.

China suffered the biggest share loss so far in 2014, dropping from 37.3% to 36.4% of total U.S. apparel imports. Total apparel imports from China were $29.8 billion in 2014. Imports from China fell slightly in December to $2 billion from $2.1 billion in December 2013. November units from China (on an SME basis) were up slightly, to 773 SME, and rose 4 percent in the full-year period, to 10.8 billion.

Still, China remains by far the largest source of imported U.S. apparel, and will no doubt retain that position for a while. Many garment manufacturers are relocating production inland to regions in which labor rates are cheaper. Key product categories from China include men’s and women’s cotton knit tops, women’s and men’s cotton pants, women’s man-made fiber knit tops and dresses, women’s and men’s man-made fiber outerwear, man-made fiber hosiery and man-made fiber bras. Imports of women’s wool sweaters from China increased by almost 20 percent in the year.

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Vietnam’s share of total U.S. apparel imports grew from 10.1% of the total in 2013 to 11.3% in 2014, a 1.2 percentage point gain. Between 2012 and 2013, the country gained only .9 percentage points of share, and the year before that, .7 percentage points. Vietnam has aggressively attracted more direct investment in textile and apparel production and as a result has attracted customers from the U.S. and Europe. In 2014, U.S. apparel imports from Vietnam totaled a record $9.2 billion, up 14 percent from 2013. SMEs from Vietnam rose by 13.2%.

Key categories of garments imported from Vietnam in 2014 included women’s cotton knit tops and dresses, cotton underwear, women’s and men’s cotton pants, women’s man-made fiber knit tops and dresses, man-made fiber slacks and man=made fiber outerwear.

Indonesia and Bangladesh remained neck-and-neck as the third and fourth largest sources of apparel to the U.S. on both a dollar and unit basis. Both countries lost share last year, however. India has gained a small amount of U.S. apparel import last year to represent 4.2% of total U.S. apparel imports. Key categories include men’s and women’s cotton and man-made fiber knit and woven tops.

Mexico, at one time a major source of imported apparel for the U.S., has declined to 4.5% of total dollar imports of apparel. A decade ago it was the second largest source, after China, with an almost 9 percent share.