Apr 25, 2017
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Adidas CEO says US manufacturing is illogical and unlikely

Apr 25, 2017

Adidas CEO Kasper Rorsted smashed dreams of future US or European manufacturing for Adidas, citing costs and realities of labor.

Rorsted, CEO Adidas

Speaking to the Financial Times about the future of Adidas' supply chain in an article published Monday, he fielded questions regarding the brand's European and American manufacturing.

With respect to US manufacturing, he spoke frankly, saying that by manufacturing in the US, "the only thing you get out of it is potentially a political interest. [Y]ou are moving into a market where you have no competence. Just financially it's very illogical and highly unlikely that will happen."

He went on to note that it would also be futile for industry competitors Nike and Under Armour to move manufacturing to the US.

These comments are particularly interesting in the face of the recent political controversy Under Armour found itself in when its CEO Kevin Plank attended a Trump White House manufacturing conference and came out in support of American jobs. As Under Armour tries to dig itself out of the pro-Trump comments made by its CEO, Rorsted appears to have taken a direct jab at the sinking ship.

Rorsted noted that 90% of Adidas' production is Asia-based. He touched on future "speedfactories" that Adidas is piloting now in both Germany and in Atlanta, Georgia, which are perfecting methods for increasing how quickly low-volume products can get to market. The goal is to ultimately bring those optimized operations to Adidas' Asian factories.

Perhaps rather harshly, or refreshingly realistically, Rorsted stated that "it’s a complete illusion to believe that manufacturing can go back to" Adidas' heritage of Europe or expand in the US. Besides the obvious connection to Trump's pressure on companies to manufacture in the US, the Adidas CEO's comments are a direct rebuke to his predecessor Herbert Haines, who in an interview with the Financial Times last year had said that the company's production would be "coming back" to Germany.


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