US and EU Tariff Shifts: What They Mean for Sourcing from Vietnam
Tariff rules keep moving in Washington and Brussels. Here is how sourcing from Vietnam is affected - and how to protect margins and origin status.
If you source from Asia, tariff policy has become a line item you re-forecast quarterly. The past two years brought US reciprocal tariffs, aggressive transshipment enforcement, and the EU's carbon border regime moving from paperwork to payments. Vietnam sits at the center of all three currents - as a beneficiary of diversification and as a target of scrutiny. We work with buyers and suppliers on both sides of these flows; here is the picture we advise clients to plan around in 2026.
The US side: lower than China, but no longer "free"
The era when moving production from China to Vietnam removed most tariff exposure is over. Under the tariff framework the US and Vietnam negotiated in 2025, Vietnamese-origin goods face a meaningful baseline tariff - lower than the rates applied to Chinese goods, but far from zero - while goods deemed transshipped through Vietnam face substantially higher rates. Exact rates and product carve-outs have shifted more than once, so confirm the current schedule for your HS codes with your customs broker or advisor before quoting landed costs.
Two practical consequences follow:
- The relative advantage still favors Vietnam. For most product categories, the spread between the Vietnam rate and the China rate remains wide enough to justify relocation - but the business case now rests on the spread, not on tariff-free access. Model both, and stress-test the spread narrowing.
- Origin is the whole game. "Transshipment" in current US enforcement is not limited to fraudulent relabeling. Products with high Chinese content and minimal Vietnamese processing risk being treated as Chinese origin. Substantial transformation in Vietnam - documented with bills of materials, production records and supplier declarations - is what secures the lower rate.
The EU side: CBAM and the compliance layer
Brussels moves differently: fewer headline tariffs, more regulatory layers. Three matter most for Vietnam sourcing:
- EVFTA benefits keep growing. Under the EU–Vietnam FTA, tariffs on most industrial goods have been phasing to zero on schedule since 2020. Buyers who set up compliant origin documentation capture real savings that many competitors still leave on the table.
- CBAM enters its payment phase. The EU's Carbon Border Adjustment Mechanism has moved beyond transitional reporting, and importers of covered goods - iron and steel, aluminium, cement, fertilizers and related categories - now face certificate costs tied to embedded emissions. If you buy metal-intensive products from Vietnam, your suppliers' emissions data is now part of your cost base.
- Due diligence rules. EU deforestation rules and corporate sustainability requirements increasingly demand traceability from Vietnamese suppliers of wood furniture, rubber, coffee and similar goods. Non-compliant supply chains do not pay a tariff; they lose access entirely.
What this means at the sourcing table
We see well-run buying organizations converge on a common playbook:
- Audit origin before price. A supplier quoting an attractive FOB price with a bill of materials that is 85% imported Chinese components may be selling you a future customs problem. Ask for BOM-level origin data during qualification, not after an inquiry letter arrives.
- Push value-add into Vietnam deliberately. Suppliers that localize more processes - molding, PCB assembly, finishing, packaging - strengthen both origin claims and lead times. Some of our manufacturing clients co-invest with key suppliers to accelerate this.
- Contract for tariff risk. Sourcing contracts increasingly include tariff-sharing clauses and reopeners triggered by rate changes above an agreed threshold. Silent contracts leave the importer holding all of the risk.
- Use bonded and duty-optimization structures. Vietnam's export processing enterprises and bonded arrangements can remove import duty on inputs destined for re-export. Structure matters as much as location.
Cost snapshot: what actually moves the landed price
| Cost driver | Direction in 2026 | What you can do |
|---|---|---|
| US baseline tariff on Vietnamese goods | Elevated vs pre-2025; stable-ish, politically exposed | Verify current rates per HS code; build spread-based business case |
| Transshipment / origin enforcement | Tightening | Document substantial transformation; audit supplier BOMs |
| EU tariffs under EVFTA | Falling on schedule | Claim preferential origin properly (REX / C/O compliance) |
| CBAM certificate costs (covered goods) | Rising as free allowances phase down | Collect supplier emissions data; prefer lower-carbon inputs |
| Vietnam labor and logistics costs | Gradually rising | Negotiate productivity, not just price; consider second-tier provinces |
Where Vietnam's position strengthens
Paradoxically, tighter enforcement helps serious operators in Vietnam. As minimal-processing schemes get squeezed out, suppliers with genuine local value chains win share - and buyers who invested in supplier development and origin compliance find themselves with defensible cost advantages. Vietnam's deepening component ecosystem, especially in electronics and furniture, makes real localization more achievable each year. Add the FTA network with the EU, UK, Japan, Canada and Australia, and Vietnam remains one of the few places on earth where a manufacturer can serve multiple Western markets from one footprint with preferential access to most of them.
Practical next steps
If you already source from Vietnam: commission an origin health-check on your top SKUs, get emissions data flowing from suppliers of any CBAM-covered inputs, and revisit contract tariff clauses at the next renewal. If you are considering a shift: qualify suppliers on documentation capability as hard as on unit price, and visit - the difference between a genuine factory and an assembly-of-imports operation is obvious on the ground and invisible in a quotation. Tariff policy will keep moving; supply chains built on documented origin and real local value-add are the ones that keep their footing when it does.
Need eyes and ears on the ground? Our partner and market access team qualifies Vietnamese suppliers, verifies origin capability and negotiates on your behalf - before tariff surprises reach your landed cost.
