Monday, 13 July 2015

Adidas plans to beat Nike to the Made in America-footwear punch

Maybe Adidas could have used a cameo appearance by Chancellor Angela Merkel of Germany.

In an announcement largely ignored by U.S. media, Adidas announced earlier this month that it plans to open a footwear factory in 2017 in Detroit.

The announcement sets up a factory arms race of sorts with Nike, which announced in May plans to hire up to 10,000 people for a U.S.-based footwear plant. The Nike announcement received some extra attention – ok, a lot of extra attention – because President Barack Obama stopped by the Nike campus the day of the announcement.

Eric Liedtke, Adidas' executive board member responsible for global brands, announced the manufacturing plan at a July 2 event in New York. It was ostensibly held to unveil the company's Ultra Boost shoes, made from plastics and netting dumped in oceans.

Like Nike, Adidas has not said how automated manufacturing would unfold – such as the types of machinery.

Adidas also has not said where in Detroit the plant would be located or how many people would be employed.

Adidas' plan calls for the first automated footwear manufacturing to start next year in Germany. The company's leadership mentioned that aspect of the plan even earlier this year – before Nike made its announcement.

One of the chief benefits of building a factory in the United States, Liedtke said, was speeding the process of delivering new products to consumers.

"It's all a part of speeding the future," Liedtke, the former Adidas America employee says in a news release. "We call it 'speed factories.' Because ultimately, if we get this thing right, we can put it in Detroit. We can bring manufacturing back to Detroit and that's where we want to be in 2017."

Footwear analyst Matt Powell of The NPD Group notes that there's precedence here -- and reason for skepticism

"New Balance has shown we can make shoes in the U.S.," Powell said in an email. "Not sure they can be made profitably though."
http://www.oregonlive.com/playbooks-profits/index.ssf/2015/07/adidas_plans_to_beat_nike_to_t.html

 
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