“Adidas clearly does not tolerate hate speech and Okabashi also stands for these values,” Okabashi said in a statement. “Unfortunately, this means Okabashi has to stop its current production for Adidas. As of right now there are not enough orders to keep all employees busy with work.”
The company said those affected by the layoffs would receive severance and extended healthcare coverage, and added that it was working with local governments and other companies to help former employees find new jobs.
Earlier this year, Okabashi announced plans to invest $20 million and create 340 new jobs over the next five years as it renovates and expands its Buford production plant.
In a statement, the company said it would “continue production of its own branded products and is pursuing other partnership opportunities to leverage its domestic manufacturing capacity and know-how.”
A family-run and women-led company, Okabashi Brands was founded by an Iranian immigrant and has sold more than 35 million pairs of shoes since it was established in 1984. The company’s brands include Okabashi, Oka-B, and Third Oak, which are sold at retail stores and online, as well to major manufacturing customers.
Okabashi remains one of the few footwear manufacturers that still produce shoes in the U.S.
Adidas began producing Yeezy footwear and apparel in partnership with Ye in 2015. Over the years, the business grew to become one of Adidas’ most valuable product lines, generating an estimated $2 billion in revenue a year for the company, according to some estimates.
But Ye’s recent antisemitic remarks on Instagram and in interviews led Adidas, Gap, Balenciaga, Vogue and other companies to cut ties with the controversial rapper.
Adidas has said halting the Yeezy line will likely cost the company $246 million this year.