450 million! The new factory is ready to start

On the morning of December 20, Vietnam Nam Ho Company held a factory inauguration ceremony in Nam Ho Industrial Cluster, Dong Ho Commune, Deling District.

Vietnam Nanhe company belongs to Nike main factory Taiwan Fengtai Group. This is a multinational company specializing in the production of sports products.

In Vietnam, the Group started investing in 1996 and has since set up factories in Trang Bom, Xuan Loc-Dong Nai, and has set up another factory in Duc Linh-Binh Thuan.

With a total investment of $62 million (about 450 million yuan), the Nam Ho plant in Vietnam is expected to attract about 6,800 workers.

In the near term, the factory plans to hire 2,000 workers to meet the production demand of about 3 million products per year.

Deputy Chairman of the Provincial People’s Committee Nguyen Hong Hai, speaking at the inauguration ceremony of the plant, noted:

In 2023, there will be a lot of volatility in the export market and the number of export orders will decrease. However, the Nam Ha Vietnam plant was completed and put into operation as scheduled in accordance with the commitment of investors. This is the effort of the board of directors and employees of Nam Ha Vietnam, supported by all levels of government and investors in Nam Ha Industrial Cluster.

Burst! Layoffs are imminent, with about $3.5 billion in severance planned

On December 21, local time, the giant Nike announced that it will restructure to reduce product selection, streamline management, use more automation technology, and improve the supply chain.

Nike also announced new measures to “streamline” the organization, aiming to cut costs by a total of $2 billion (14.3 billion yuan) over three years in response to increasing competition from rivals such as Hoka and Swiss company On.

Some employees may lose their jobs.

Nike did not say whether its cost-cutting efforts included job cuts, but said it expected to generate severance costs of about $500 million, more than double what it had forecast before the last mass firing.

On the same day, after the financial report was released, Nike fell 11.53% after the market. Foot Locker, a retailer that relies on Nike products, fell about 7 percent after hours.

Matthew Friend, Nike’s CFO, said on a conference call that the latest guidance reflected a challenging environment, particularly in Greater China and the European and African Middle East (EMEA) region: “There are signs of increasingly cautious consumer behaviour around the world.”

“Looking ahead to the weak revenue outlook for the second half of the year, we remain focused on strong gross margin execution and disciplined cost management,” said Friend, Nike’s CFO.

David Swartz, senior equity analyst at Morningstar, said Nike is about to reduce the number of products it has, possibly because it believes too many of its products are not high-margin products that can generate significant revenue.

According to The Oregonian, the outlook is bleak after Nike quietly fired employees in recent weeks. The layoffs affected multiple departments, including branding, engineering, recruiting, innovation, human resources, and more.

Currently, the sportswear giant employs 83,700 people worldwide, according to its latest annual report, with more than 8,000 of those employees located on its 400-acre Beaverton campus west of Portland.