Reebok's founder says moving production from Asia is hard when no one wants to sit at a sewing machine
Joe Foster, a 90-year-old Reebok veteran who cofounded the footwear and clothing brand in 1958 in the UK, spoke on a Yahoo Finance's Opening Bid podcast interview, released Monday.
When asked how tough it was for companies like Nike, Adidas, and Reebok to move production out of Asia, Foster said that's "virtually impossible" to accomplish on a short timeline.
"If you want millions, as we wanted, millions of products, you've got to go somewhere where you've got a lot of people who are quite willing to sit on a machine, women on the sewing machines, men on the production line, and that doesn't happen overnight," Foster said.
"In the UK, we can't get people to do that. They won't do it, they've moved on to whatever different things, and I think the States are exactly the same," he added.
He said that to move manufacturing West, a faster method of making shoes with robots and automation is needed. But automation for complicated sneakers, which he said have more than a hundred pieces, was difficult.
The industry had not progressed to that stage, and the apparel and footwear business was "going to be in the Far East for a long time," he said.
Reebok's manufacturing is concentrated in Asia, particularly in countries like Vietnam and China. The private company has been headed by CEO Todd Krinsky since 2022.
It is owned by the NYC-based Authentic Brands Group, which also owns other apparel brands such as Champion, Billabong, Van Heusen, and Ted Baker.
Retailers have been grappling with the effects of Trump's tariffs, which have targeted Asian countries heavily involved in apparel manufacturing. Goods entering the US from Vietnam and China are now hit with a 20% and 30% levy, respectively.
In a June earnings call, Nike announced it would raise prices for US customers because it anticipated a $1 billion cost increase from tariffs.
Other companies have announced that they will move manufacturing to the US to mitigate the impact of the tariffs. In April, French luxury giant LVMH said it was considering increasing the capacity of its production facilities in the US.
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San Francisco Chronicle
25 minutes ago
- San Francisco Chronicle
Trump's tariff pressure pushes Asia toward American LNG, but at the cost of climate goals
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'Trump has put pressure on a seeming plethora of Asian trading partners to buy more U.S. LNG,' said Tim Daiss, at the APAC Energy Consultancy, pointing out that Japan had agreed to buy more despite being so 'awash in the fuel' that it was being forced to cancel projects and contracts to offload the excess to Asia's growing economies. 'Not good for Southeast Asia's sustainability goals,' he said. LNG deals could derail renewable ambitions Experts say LNG purchasing agreements can slow adoption of renewable energy in Asia. Locking into long-term deals could leave countries with outdated infrastructure as the world shifts rapidly toward cleaner energy sources like solar or wind that offer faster, more affordable ways to meet growing power demand, said Indra Overland, head of the Center for Energy Research at the Norwegian Institute of International Affairs. 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But it's pretty important,' he said. This was the concern during the recent potential disruptions to fuel shipments through the Strait of Hormuz and earlier during the war in Ukraine, when LNG cargoes originally destined for Asia were rerouted to Europe. Despite having contracts, Asian countries like Bangladesh and Sri Lanka were outbid by European buyers. 'Events in Europe, which can seem very far away, can have an impact on availability and prices in Asia,' Kenner said. Asian countries can improve their energy security and make progress toward cutting carbon emissions by building more renewable energy, he said, noting there is vast room for that given that only about 1% of Southeast Asia's solar and wind potential is being used. 'There are genuine choices to meet rising electricity demand. It is not just having to build LNG,' he said. Jintamas Saksornchai in Bangkok contributed to this report. ___ Associated Press climate and environmental coverage receive support from several private foundations. See more about AP's climate initiative here. The AP is solely responsible for all content.
Hamilton Spectator
an hour ago
- Hamilton Spectator
Trump says Coke will shift to cane sugar. But increasingly, shoppers want no sugar in their sodas
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San Francisco Chronicle
an hour ago
- San Francisco Chronicle
Asian shares mostly advance after Wall Street cruises to more records
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