Elder Patriot – Almost two years ago we warned you that China’s economic control over U.S. companies would result in political fallout here in the United States. At that time we wrote:
Zuckerberg knows that to gain access for his social media network to China’s 1.1 billion people he’ll need to play by China’s rules. That means accepting China’s Internet censorship rules.
… it won’t be long before the share of Facebook’s revenue coming from China dwarf’s the revenues the company is realizing in the United States. This will give China enormous future influence over Facebook’s future content in the United States.
It didn’t take an political savant to understand what the future held, just someone who understood the drive for profits shared by large-scale corporations.
This principle applies to Nike and explains their decision to literally destroy $3.75 Billion in market cap with their decision to make Colin Kaepernick the face of their company without blinking an eye.
The CEO and corporate board at Nike fully expected the fallout and accepted it because cutting ties to their Chinese supply-manufacturing chain would’ve been far more expensive. Make no mistake, Chinese pressure forced Nike into this decision.
Nike has hitched its massive corporate existence to a 10-year business plan that is dependent on the continuance of recently negotiated manufacturing contracts.