Adidas shifts orders from striking Yue Yuen factory in Dongguan

Source:Reuters-Global Times Published: 2014-4-24 23:58:20

Adidas showcases its football products at a trade meeting in Fuzhou, South China's Fujian Province, on March 24 Photo: CFP

 Sportswear firm adidas AG is shifting some orders from a factory in South China that has been at the center of one of the country's biggest labor strikes, Reuters reported Thursday, underlining a rising challenge for firms doing business in the country, where an increasingly savvy workforce is pushing harder for its rights.

Thousands of workers at a factory in Dongguan, South China's Guangdong Province, have been on strike for more than 10 days demanding improved social insurance payments, better pay and fairer contracts. The factory is run by Hong Kong-listed Yue Yuen Industrial Holdings,

"In order to minimize the impact on our operations, we are currently reallocating some of the future orders originally allocated to Yue Yuen Dongguan to other suppliers," a China-based adidas spokeswoman commented in an e-mail to Reuters.

Adidas has no plans to sever ties with the Dongguan-based plant, and the majority of any new supply would come from within China, the spokeswoman added. "China is, and will continue to be, a strategic sourcing country for us," she said.

Yue Yuen declined to comment on adidas' decision or on whether other clients were making similar moves.

The plant has around 40,000 employees and also supplies rival leisurewear brands such as Nike Inc. Yue Yuen said it made around 300 million pairs of shoes last year.

About 20 protesters from labor rights groups in Hong Kong protested at adidas' local office on Thursday, demanding the company to work with Yue Yuen to compensate workers and help release those who have been detained. The protesters also went to nearby adidas, Nike and other stores of brands supplied by Yue Yuen to voice their demands.

China's declining labor force has given workers greater confidence to demand their rights. The country's working age population shrank by almost 6 million in the past two years, National Bureau of Statistics data show.

Dozens of workers protested against Wal-Mart Stores Inc in Central China's Hunan Province after the US grocery chain said last month it was closing a store there.

Reuters - Global Times

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