KTAF NEWS

Production at some of Nike’s largest factories in Vietnam has been interrupted because Covid19 has spread in the factories.

The company declined to comment on whether the outbreak will cause shortages in stores.

Last fiscal year,about half of Nike’s shoes were made in Vietnam, so this will pose a challenge to its supply chain.

Since April last year, Vietnam has seen a record increase in cases, with many clusters of infections in its industrial provinces.

Apple, Samsung and Puma may also be affected by the surge in recorded cases at supplier factories in the country.

Nike said in a statement: “The health and safety of our teammates and suppliers remains our top priority.”

Nike said the company will continue to work with its suppliers to provide them with support to deal with the increase in Covid19 cases.

The statement also said: “We are confident in Nike’s ability to grasp recent developments, and we remain cautious in planning.”.

Pou Chen Corp., one of Nike’s most affected suppliers in the region, also produces footwear for Adidas.

Due to the outbreak of infection, the company suspended operations at its Ho Chi Minh City plant on Wednesday.

The Ministry of Health of the country said in a statement that Baochen’s Baoyuan plant in Vietnam will suspend production for 10 days.

This factory is the largest employer in Ho Chi Minh City, with a total of 56,000 workers. However, the Ministry of Health stated that the company was unable to maintain operations and arrange workers to sleep in the factory in accordance with the authorities’ requirements to limit the spread of infection.

Nike has more than 450,000 employees in the country, 80% of whom are women.

Puma may also face similar challenges, and its footwear is also manufactured in the country. Apple and Samsung also have large suppliers in the worst-hit factories in northern Vietnam.

Apple did not comment on whether the epidemic meant a shortage of goods in stores, and Adidas, Puma and Samsung did not immediately respond to media requests for comment.

About half of Samsung’s mobile phones are produced in Vietnam and had to suspend work at three factories in Ho Chin Minh City.Cadysneaker, According to the Ministry of Health website, Samsung Electronics is planning to let workers sleep in the factory, and has reduced the number of employees from 7,000 to 3,000.

Due to the challenge of tariffs during the pandemic, many companies have begun to move production from China to Vietnam and other countries.

Dr Patsy Perry, a senior lecturer in fashion business at the University of Manchester, said that as people stay at home more and more, the demand for sportswear related to Covid19 has surged, making these problems even worse. .

She explained: “This shows the risk of over-reliance on a particular procurement area.”.

However, Dr. Perry said that Nike’s manufacturing map means that it is possible to transfer production to other countries, depending on the agility of its supply chain relationship.

Dr. Perry added: “If production needs to be transferred to higher-cost areas, costs may increase in the short term, but meeting demand is more important than risking out-of-stock.”.

Only 4% of Vietnam’s 100 million people have been vaccinated. Due to the new round of Covid19 infection, the capital Hanoi has stopped all unnecessary services and urged citizens to stay at home on Sunday.