From schools shutting down to overfilled hospitals, the pandemic has affected the world in numerous ways. Now, it seems that Nike is facing a shortage of sneakers as the Covid-19 pandemic worsens in Vietnam. Nike’s suppliers in Vietnam were forced to halt production as Coronavirus swept through the country. Their two suppliers: Chang Shin Vietnam Co. and Pou Chen Corp were forced to halt manufacturing. Since April, Vietnam has recorded over 83,000 infections and 335 deaths.
Vietnam accounts for 49% of U.S. imports to Nike and 82% of footwear shipments in the last year. Nike CFO Matthew Friend stated that he “expects supply chain delays and higher logistics costs to persist throughout much of 2022”. Another Nike spokesperson stated, “The health and safety of our teammates, as well as that of our suppliers, remains our top priority”. As a result of the production halt, Nike’s shares were down 1.3%. Demand from consumers vastly outweighs the supply with the recent production halt in Vietnam not helping. While a sneaker shortage is not beneficial to Nike and its consumers, the more important issue is the health and safety of those affected by Coronavirus. In the coming days, Vietnam would institute a 15-day lockdown in the capital city of Hanoi. This comes as a result of a record 7,295 cases in 24 hours. Vietnam has currently administered 6,959,197 doses of the COVID vaccines so far which is only enough for 3.6% of their population. To combat the recent surge in infections, Vietnam has shut down several major cities, built several field hospitals, and plans to open up more vaccination centers. https://www.spglobal.com/marketintelligence/en/news-insights/blog/qa-data-that-delivers-automating-the-credit-risk-workflow https://www.npr.org/2021/07/24/1020162186/vietnam-hanoi-lockdown-covid-cases-coronavirus https://www.cnbc.com/2021/07/19/nike-could-run-out-of-shoes-from-vietnam-as-covid-worsens-sp-global.html https://finance.yahoo.com/news/nike-could-run-out-of-sneakers-made-in-vietnam-as-the-covid-cases-spike-there-191540146.html
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