According to a report, as the COVID-19 situation in Southeast Asia continues to deteriorate, Nike’s shoes have been sold out, and nearly half of the company’s US imports come from Southeast Asia. New report From Standard & Poor’s Global Market Intelligence.
Vietnam’s top suppliers Chang Shin Vietnam Co. and Pou Chen Corp. recently stopped production after the outbreak of the new crown pneumonia in the region. In 2020, Vietnam accounted for half of Nike brand footwear production. Nike Chief Financial Officer Matthew Friend predicts that supply chain delays and higher logistics costs will continue until May 2022.
According to Panjiva’s data, Vietnam accounts for 49% of all US seaborne imports related to Nike. Nike’s imports from Vietnam are dominated by footwear, which accounted for 82% of its shipments in the past year.
S&P Global warns that as the new crown virus crisis worsens, Nike may run out of sneakers made in Vietnam https://t.co/ujveri6oS8
— CNBC (@CNBC) July 19, 2021
The suspension has affected Nike’s supply chain and other retailers. As Americans approach the start of the school season, the shortage is expected to worsen. Other obstacles include shortage of containers and insufficient port space.
CEO of Brooks Running Company Jim Weber Said that his company’s current shipping cycle is 80 days, while it used to take 40 days. “There is no doubt that the supply chain of our industry is fragmented,” he said.
Nike shares fell about 1.3% on Monday, but it has risen 11.5% so far this year. Nike’s market value is approximately $250 billion.
