NEW YORK — With the dollar tumbling to new lows against the euro, Italian clothing makers exporting to the U.S. are having to make an unenviable choice: Either increase retail prices or pinch their margins. But as Europe’s luxury suit makers prepare for a squeeze this coming fall, another group is celebrating—the Americans.

For the handful of tailored clothing manufacturers still based in the U.S., the slumping dollar is helping keep their prices steady, while their counterparts across the pond are raising prices by as much as 15 percent—a reality the Americans hope will make their products more attractive to consumers.

“There’s going to be extraordinary sticker shock on European goods,” said Marty Staff, CEO of JA Apparel, which makes Joseph Abboud–brand suits in a company-owned factory in New Bedford, Mass. But Staff and the other Yankee manufacturers are not completely protected.

The rising cost of European piece goods will bump up the price of Abboud suits by 8 percent on average next fall, but that’s much less, Staff said, than that of the average European manufacturer, which, in addition to cloth, pays for labor in euros. “Our price has never been more fair compared to our competitive set,” he said.

The euro has been steadily rising against the dollar since the end of 2005, when it was valued at $1.16. This past November the euro topped out at $1.48, and last week was hovering around $1.46. Until recently, mills that supply the clothing trade had kept prices in check. But for fall 2008 goods, cloth makers, citing the euro’s ascent in the last quarter, are raising their prices.

“Mills are now revising their price lists to accommodate the [euro],” said Mike Cohen, CEO of Chicago-based Oxxford Clothes, which uses European piece goods for its prestigious line of tailored clothing. “They are coming back now with increases of at least 15 percent.”

For manufacturers like Domenico Vacca, which sources and produces its clothing in Italy, the exchange rate will take a bite out of company profits. Wary of raising prices for his line of elegant suits and sportswear, Vacca, the company’s founder and head designer, is preparing to lower his margins by nearly 11 percent. “[The dollar] is becoming a problem for companies like mine that manufacture in Italy,” Vacca said. “But we decided not to raise prices. In a year there may be some adjustment [in the rate].”

Neapolitan luxury house Kiton is taking a different tack, raising its prices for U.S.-bound fall goods between 10 and 15 percent. Nevertheless, company CEO Antonio De Matteis is sanguine about his U.S. business, citing Kiton’s continued growth stateside and the resilience of the luxury consumer. “It’s not going to change our strategy at all,” he said.

However, the exchange rate is causing executives to reconsider their supply chain and distribution strategies. The cheap dollar is prompting Paulette Garafalo, group president of Hartmarx, to consider taking the company’s Hickey Freeman brand to the Old World. The Rochester-made suits, she said, could find traction in Europe, buoyed by both a favorable exchange rate and increased demand for American brands.

Thanks to the greenback, Staff is shifting plans for the Joseph Abboud brand’s ambitious push into China. The company will manufacture in Asia, but some goods, in a considerable reversal, will be made in the U.S. and then sent overseas. “We’re going to export to China. It’s a man-bites-dog story,” quipped Staff.

Tom James, the direct-retail brand owned by IAG, is tweaking its supply chain. Its best lines will still be sourced and made in Italy, but some knitwear in the company’s more moderate lines will no longer be produced in the country, according to Christian Boehm, James’s director of marketing and merchandising. “There are a number of programs in sportswear that need to go elsewhere,” he said. “At $3,200, a 10 percent increase is nothing, but for $400 goods the increase makes a difference.”

Oxxford is also looking to mitigate its exposure to the euro. The company is using more cloth from company-owned mills, which include Holland & Sherry and Clissold, both in the U.K. “Minimums at our traditional partners have increased,” said Cohen. “We’re relying more on in-house mills to produce special cloths. The euro is forcing business out of Biella.”

But most say that despite the thorny exchange rate, nothing can replace the quality or cachet associated with European makes or piece goods, and that moving production to a country with a better exchange, like China, isn’t justified. “It’s not easy to change sources at this level,” said Vacca. “We just have to be patient and keep it tight.”