New Balance is going all in with its commitment to Made in America manufacturing amid global supply chain backlogs, with the global footwear manufacturer showing off its newest factory Monday in Methuen, Mass.
The 80,000-square-foot facility currently employs more than 90 workers producing the athletic brand’s popular Made 990v5 running shoe. The company estimates that the facility will produce 750,000 pairs of sneakers each year.
Production at the facility officially began in January after the building underwent a $20 million renovation. But New Balance plans to more than double the factory’s headcount and total production capabilities by the end of the year. In bringing the employment total at the warehouse to more than 200, New Balance is tripling the 60 jobs it initially promised Massachusetts state officials it would add.
At the factory’s opening ceremony on Monday, New Balance demonstrated how workers prepare, cut and mold materials and components and then sew, press and assemble them into the final product.
Including the Methuen factory, Boston-headquartered New Balance owns five manufacturing facilities across Maine and Massachusetts that employ approximately 1,000 workers. These spaces are largely used to manufacture sneakers across the Made line, which are at least 70 percent domestically produced. The company operated another plant in neighboring Brighton, Mass., but shuttered the location in December 2020 amid the Covid-19 pandemic. New Balance has held onto that property and plans to repurpose it at some point.
New Balance president and CEO Joe Preston was among a who’s who of company execs at the event, which also included chief operating officer Dave Wheeler, plant manager Derek Cobbe, chairman Jim Davis and vice chairman Anne Davis.
“Along the way, while every other brand moved their production offshore, Anne and Jim Davis’ unwavering commitment to community and value set the tone for our company culture and paved the way for our domestic manufacturing expansion,” Preston said. “Here in the Merrimack Valley, that commitment began 44 years ago.”
Preston pointed to John Wilson, New Balance’s longest-tenured employee, who has worked with the company since Davis purchased the company in 1972. Wilson is now executive vice president of manufacturing.
“I don’t think we would be here today if it wasn’t for [Wilson’s] can-do attitude,” Preston said.
As part of its Made in America commitment, New Balance is proactively working to innovate and expand its domestic supplier network for the Made U.S. footwear line. The company aims to drive new automation and incorporate robotics in the factory to enhance associate safety and ergonomics while increasing productivity.
For example, the location currently features multiple Spraybot systems, which are automated work cells designed so a robotic arm can apply any surface treatment to footwear, midsoles and outsoles.
The factory opening comes as New Balance comes under fire for the extent to which it positions its products as Made in America. A December class action complaint takes issue with seven specific sneaker models, six of which explicitly include “Made in USA” printed on each shoe’s tongue. In each case, the lawsuit claims the Made in USA descriptor is false and misleading, particularly the 70 percent domestically produced claim. This total, it alleges, does not meet the Federal Trade Commission (FTC) guidelines that “[f]or a product to be called Made in USA, or claimed to be of domestic origin without qualifications or limits on the claim, the product must be ‘all or virtually all’ made in the U.S.”
In 2019, New Balance paid $750,000 to settle a similar class action lawsuit.
In fact, the majority of New Balance products are still manufactured in China, Indonesia, Vietnam, Thailand and Cambodia. The company also owns and operates a factory in Flimby, England.
As New Balance and its competitors were significantly hampered by factory closures amid the Covid-19 pandemic, as well as ongoing supply chain backlogs, the move illustrates why some apparel and footwear companies are looking for domestic alternatives and options close to home.
“I know everyone has experienced supply chain shortages in our personal lives and in business. The longer the supply chain, the more likely the disruption,” Wheeler said. “That’s why in creating this new factory in the image of New Balance, heritage is a critically important step on our journey towards expanding our ‘Made in the USA’ manufacturing capacity. The pride and craftsmanship that goes into every single shoe off the production line is evident. It’s tangible and it delivers the fit, quality, comfort, performance and innovation we’re known for.”
Local government representatives at the factory debut included Massachusetts Governor Charlie Baker, Lt. Governor Karyn Polito, U.S. Congresswoman Lori Trahan of the state’s 3rd Congressional District and Methuen Mayor Neil Perry.
“New Balance is a jewel. The leadership is astonishing and the people who work for this very special company are amazing,” Gov. Baker said.
Trahan, who serves on the House Energy and Commerce Committee, also lauded New Balance for creating new domestic manufacturing job opportunities.
“One of my top priorities since getting to Congress just three years ago has been to reinvigorate our domestic manufacturing capabilities, making sure more products are made here in the United States, whether that’s computer chips, PPE, medical devices and yes, sneakers,” Trahan said. “But when it comes to domestic manufacturing, New Balance has been leading that charge for decades. These are great jobs that pay family-sustaining wages and that’s exactly what we need more of as we continue recovering from the pandemic.”
As part of the opening, New Balance delivered a $100,000 gift from the New Balance Foundation to the Methuen Branch YMCA that will fund a renovation of its outdoor playground and basketball court.
In 2021, New Balance generated $4.4 billion in sales, with approximately one-third of total sales coming from the U.S., according to Preston. Sales climbed 32 percent year over year compared to 2020, and roughly 10 percent over 2019 totals.