Supply chain issues could cost Adidas €500m

Adidas has said it could lose up to €500 million in sales because of pandemic related supply chain disruption.

A sharp rise in Covid cases in Southern Vietnam mean two of the sportswear giant’s primary manufacturers have stopped production.

However, Adidas said sales for the first half of the year were above pre-pandemic levels from 2019.

Ho Chi Minh, Vietnam’s largest city, has seen the highest rise in Covid-19 cases, and imposed a strict lockdown on July 9.

Taiwanese company Pou Chen, which makes shoes for Adidas and Nike, closed its largest factory in Vietnam until August 9 at earliest.

On Sunday, Vietnam's health ministry reported a record 9,690 coronavirus infections.

“We expect the situation in Vietnam to start improving later this month, leading to a largely operational sourcing network at the end of the third quarter,” said chief executive at Adidas Kasper Rorsted.

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