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Why Is New Balance Pro-Trump?

It’s all about TPP.

Photo: New Balance

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New Balance’s vice president of public affairs Matt LeBretton told a Wall Street Journal reporter yesterday that the company is happy with the election results. With Donald Trump as President of the United States, the company feels “things are going to move in the right direction.” LeBretton added that the company felt “the Obama admin turned a deaf ear to us.”

New Balance is apparently the only brand to side with Trump; the rest of the fashion industry appears distraught. If you’re wondering why New Balance has spoken out in support of a President-elect who's made racist comments about nearly everyone under the sun, whose misogynist rhetoric and boasts of sexual assault just propelled him into the White House, it’s because the company is against TPP, that three-letter acronym we heard so many times during debates and rallies that stands for Trans-Pacific Partnership, a trade agreement Trump has promised to roll back.

The short explainer on TPP is that it lowers tariffs (taxes on imports and exports) and other costs associated with importing and exporting goods and materials from certain countries involved in the partnership, including Vietnam, Japan, Malaysia, and Australia.

The law works in favor of footwear companies like Nike, which produces “a large percentage” of its shoes in Vietnam, according to the Wall Street Journal. The thought process is that without the tariffs, Nike can pass along savings to customers. New Balance has long opposed TPP because the company manufactures shoes domestically, in Massachusetts. New Balance believes that because manufacturing in the US is more expensive, the tariffs are the only thing that keep costs competitive between itself and a company like Nike or Adidas. It’s worth noting here that New Balance does import shoes and parts from Vietnam — 70 percent of the shoe company’s manufacturing and labor is done in the US — but it recently invested in machinery so that it could create shoes that were 100 percent made in the US. These shoes were almost able to make TPP a win for New Balance as well.

LeBretton told NPR earlier this year that New Balance kept quiet about its dislike for TPP because the Obama administration promised to contract the company to make sneakers for the military. The military is required to buy products made entirely in the US and New Balance’s sneakers met those specifications. “The sole unit's Carolina. The outsole is Massachusetts. Ohio is the insert. Shoelaces are Rhode Island,” David Sullivan, the shoe’s engineer, told NPR.

However, the deal never came to fruition because, as the Office of the US Trade Representative told NPR in a written statement, New Balance’s sneakers weren’t up to the military’s standards. New Balance promised to vocally oppose the TPP because of the fallout.

Hillary Clinton also promised to kill TPP if she were elected president.

Watch: Stan Smith, the Man Behind the Famous Shoe