New Balance prides itself on selling running shoes and sneakers “Made in the U.S.A.” Its domestic operation includes five New England factories, including one in Lawrence, which employ about 1,600 people. At the end of last year, the company announced plans to open a new production line in Methuen as well.
How unexpected then to find the Boston-headquartered company lining up with hundreds of other U.S. operations complaining about the effects of a pitched trade battle with China. Yet, there was New Balance earlier this week, putting its foot down in a hearing arranged by the Office of the U.S. Trade Representative to seek input on Chinese tariffs.
It's not because New Balance disagrees with a firm hand toward China, mind you, or solely because of retaliation by the Chinese in slapping tariffs on U.S. made products bound for its markets. New Balance is also worried because its American-made shoes lean on a global supply chain that gets squeezed by U.S. duties on imported supplies.
“The unfortunate reality is that when the rest of the footwear industry moved off shore years ago, it took the domestic supply chain with it,” the company stated in an outline of its hearing testimony earlier this month. “The limited supply chain that exists today in the U.S. is simply too small to support the scale of U.S. footwear manufacturing that we have worked so hard to maintain.”
So, while the vast majority of its shoes are made here in the United States, some components of those shoes are made and shipped from overseas.
New Balance says it's acutely aware of U.S. struggles with the Chinese over intellectual property — a major sticking point between the countries that has escalated the current trade dispute. Two years ago, the company won a major trademark infringement case in Chinese courts.
Still, New Balance's predicament illustrates the vast, sometimes surprising effects of our trade negotiations with other countries. This drawn-out dispute with the Chinese very much affects people working on production lines in Lawrence and elsewhere in New England.