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Nike and adidas Continue to Shift Production Away from China

Date: May 13 2018

By: Boon Mark Souphanh

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Major footwear and clothing companies continue to move production out of China. Since 2010, adidas have halved their Chinese manufacturing, with Vietnam absorbing most of the business.

The trend is similar over at Nike, as big brands look to move away from increasing labour costs. As China shifts its focus to more valuable items, such as electronics, wages for higher skilled workers have been on a steady rise. As a result, many international footwear, clothing and textile brands have turned to low-wage nations in South-East Asia for production.

Japan’s largest fashion chain Uniqlo has also increased its major suppliers in Vietnam by about 40 per cent in the past year.

Kasper Rorsted, adidas CEO, recently shrugged off fears that the US — the world’s largest sneaker market — may impose new tariffs on Chinese made products as part of Trump’s escalating trade spat with the country. Rorsted stressed that China was still important for sourcing, but acknowledged Vietnam’s growing importance.

‘I’m not going to rule out that this trend is going to continue,’ he said. 

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