New Balance CEO Rob DeMartini held a press conference at New Balance’s Boston headquarters on April 12, 2016 to talk about his opposition to the Trans-Pacific Partnership, a trade deal between a dozen countries negotiated by President Barack Obama’s administration. The Obama administration says the deal will make it easier for Americans to sell their products abroad by eliminating taxes and other trade barriers.
DeMartini expressed concern that the trade agreement would cost America jobs by eliminating tariffs on imported goods, which today favor American-made products. “As the agreement came together, what we ended up seeing was the fastest ramp down of the tariffs in history,” DeMartini said. “It means our competitors who source overseas will get a pricing advantage much quicker than they did in any previous deal.”
“We feel like we’re being penalized for staying the longest and working the hardest to keep these jobs in America,” he continued. DeMartini said it costs him an extra $30 to make a pair of shoes in the U.S., rather than overseas.
New Balance opposed the Trans-Pacific Partnership for years, but DeMartini said the company agreed to remain neutral for the past year after receiving assurances from U.S. officials that the Department of Defense would allow New Balance to bid on a contract to make running shoes for the military.
DeMartini said the decision to go public with the company’s opposition stemmed from frustration with the Obama administration’s lack of action on an unrelated law that would allow New Balance to compete for a military contract. “There was no quid pro quo deal. We didn’t want an earmark contract,” DeMartini said at the press conference. “We wanted to compete for a piece of business we’re very confident we can win.”
DeMartini stopped short of saying he would close factories or lay off workers in the U.S. if the deal goes through. Though he called it a “significantly increased challenge,” DeMartini said, “We’re going to do everything we can to keep the jobs here.”
New Balance is the only major athletic shoe company to manufacture shoes in the U.S., although not all of its shoes are made here. It employs 4,000 people in the U.S., including 1,400 in manufacturing and 720 at its world headquarters in Boston.