Jon Emont
Appearances
The Journal.
Made in America? Shoe Companies Already Tried That.
I'm mainly a my wife found a sale and there's a hole in my shoe, so we really have to get that sorted out guy, I suppose.
The Journal.
Made in America? Shoe Companies Already Tried That.
Since I've lived out in Asia, I've been really interested in shoe production. You know, all our shoes are made here.
The Journal.
Made in America? Shoe Companies Already Tried That.
couple of things. These sneakers there, it's not like garment making. It's not like making a t-shirt. To make a t-shirt, you just need sewing machines and you need people who are skilled enough to sort of make the t-shirts. And actually, you can find that just about everywhere. A secret t-shirt could be made in one of 40 countries, probably. With shoes, it's different.
The Journal.
Made in America? Shoe Companies Already Tried That.
And critically, it's also labor intensive. So there are only a couple of countries where you have this cheap labor force that's willing to do a lot of the manual work. And it is skilled labor. So you do need to be trained and you do need to be willing to do it. And you do need to be sort of dexterous and things.
The Journal.
Made in America? Shoe Companies Already Tried That.
Could we just rethink how shoes are made? Just because they've always been made this way, do they have to be?
The Journal.
Made in America? Shoe Companies Already Tried That.
The idea that, you know, you could just rely on cheap labor from these countries, you know, forever, was starting to come into question. And then there was all these new advances in automation.
The Journal.
Made in America? Shoe Companies Already Tried That.
And it's been this way for now about 20 years.
The Journal.
Made in America? Shoe Companies Already Tried That.
Labor is just more expensive in North America, and it's also not as readily available as in East Asia. So if your goal is to make shoes in North America and make them be price competitive with the shoes you're producing out of Asia, then you really need to automate it, and that means robots.
The Journal.
Made in America? Shoe Companies Already Tried That.
They wanted tens of millions of shoes produced there by the year 2023.
The Journal.
Made in America? Shoe Companies Already Tried That.
whether it's Adidas or Nike or Under Armour, they're making their shoes in these three countries. And they're kind of the Goldilocks countries for shoes.
The Journal.
Made in America? Shoe Companies Already Tried That.
Many of the people involved in the project did hope that once they got this solved, once they figured out how to make a heavily automated shoe, that then some production could be moved into the United States proper.
The Journal.
Made in America? Shoe Companies Already Tried That.
Flex is a contract manufacturer, so they make things for other companies. And what they're mainly known for making is electronics. So one of their biggest projects ahead of the Nike project was working with Apple to make MacBook Pros in Austin, Texas.
The Journal.
Made in America? Shoe Companies Already Tried That.
It became clear how challenging this effort was going to be pretty soon after they started.
The Journal.
Made in America? Shoe Companies Already Tried That.
You know, there are all sorts of challenges to automating shoe production. All the materials you're dealing with are squishy and they sort of change dimensions with the temperature, with humidity. And these are things that humans are, you know, very adept at quickly dealing with. But machines need precision and precision.
The Journal.
Made in America? Shoe Companies Already Tried That.
If the sole of the shoe is a little different from the last sole of the shoe, well, a machine might just put the glue in the wrong place, whereas a human worker would just quickly adapt. And stuff like that just took a while to sort out.
The Journal.
Made in America? Shoe Companies Already Tried That.
Donald Trump has introduced tariffs on Asian countries, including the three Asian shoemakers we discussed, Vietnam, Indonesia, and China. And the stated purpose of that is to bring back manufacturing to the United States.
The Journal.
Made in America? Shoe Companies Already Tried That.
And suddenly they had to figure it all out again. You know, Nike's producing tons of different new types of shoes all the time. So again, a human workforce is, you know, pretty adaptable. Okay, we're now doing things this way. Okay.
The Journal.
Made in America? Shoe Companies Already Tried That.
Exactly. But these things can be tricky. And the other thing you have to remember about shoes is that, you know, they come in, you know, more than a dozen sizes. They often come in different colors and there are often, you know, little distinctions. So you need machines that can sort of adapt to all of that too. And that's tricky. You can't fail, right? It has to work every single time.
The Journal.
Made in America? Shoe Companies Already Tried That.
One of the chief challenges of the project was that you had a company that was in certain ways spoiled, like a lot of American companies. They're very design-oriented. They're trying to push boundaries. And so what they're used to doing is having these very creative designers say, we want this shoe. It has these properties. It uses these materials. It is different from other shoes in these ways.
The Journal.
Made in America? Shoe Companies Already Tried That.
And then they tell their extremely skilled Asian shoe manufacturing partners that, make the shoe and they can do it.
The Journal.
Made in America? Shoe Companies Already Tried That.
Not really. The Adidas Speed Factory, which is what they called it, they shipped the equipment to Asia. So the technology was moved to Asia. And with the Project Glory with Under Armour, that's the one that there's least information about. They just stopped mentioning it. So they mentioned it in 2015, Project Glory, and proudly to investors and, you know, haven't heard about it since.
The Journal.
Made in America? Shoe Companies Already Tried That.
And now they make, you know, the vast bulk of their shoes in these Asian countries.
The Journal.
Made in America? Shoe Companies Already Tried That.
It's really hard to imagine a quick shift out of Asia. In fact, it's pretty impossible. I think with the Nike example, the clearest thing, what it shows you is that actually robots can't make everything so that you will need a lot of laborers. You will need a lot of skilled laborers and good luck finding them in the United States, right?
The Journal.
Made in America? Shoe Companies Already Tried That.
You know, you can find them, but you're gonna have to pay them, you know, pretty well. And that's definitely gonna be expensive and very, very difficult.
The Journal.
Made in America? Shoe Companies Already Tried That.
It's interesting to know that Nike, as well as other big shoemakers like Adidas, like Under Armour, have actually tried this recently, and they all failed.