Adidas to bring back shoe production home from Asia

Adidas said on Tuesday it will begin robot-based mass production of sports shoes in its home market of Germany in 2017.

It will be the first time in 24 years that the world’s seacond-biggest sports goods maker has mass produced shoes domestically, having last done so in 1993. Adidas currently outsources the bulk of its manufacturing to Asian countries with low labor costs.

Its shoes are the “face” of the German brand, and the return home of their production may herald a turning point in global manufacturing. International brands like Adidas and Nike of the U.S. have long relied on cheap labor in countries like China and Vietnam to make shoes, balls and clothing. But as wages in Asia rise, robots have emerged as an increasingly cost-competitive alternative, and companies like Adidas are finding it makes economic sense to repatriate at least some of their production operations.

In December last year, Adidas launched a pilot “speedfactory” in the southern German state of Bayern, where it is headquartered, in collaboration with local auto parts and medical equipment makers. A successful test run of 500 pairs of shoes convinced the company that output at the robot-filled plant could be expanded to a much larger scale.

Adidas also plans to start robot-based mass production of shoes in the U.S. in 2018. A high level of automation means factories can operate around the clock and production lines can be easily tweaked in response to changing consumer tastes in the European and American markets, which largely set worldwide trends.