Franca's shoe factories idle as US tariffs bite into exports
US tariffs on Brazilian goods have slashed footwear orders, forcing factories in Franca to cut staff and idle production lines.
Assembly lines in Franca, Brazil's shoe-making heartland, are running well below capacity as new US tariffs take a heavy toll on export orders. The city, home to more than 2,000 footwear-related businesses and an estimated 20,000 to 30,000 workers in the sector, is facing one of its toughest periods in recent memory.
The US Trade Representative announced a 25 percent tariff on selected Brazilian products starting July 22, followed by an additional 12.5 percent surcharge on goods from Brazil and other economies over forced labor concerns. For footwear, the combined rate now stands at 37.5 percent.
Toni Hajel, director of a local shoe factory, described the impact on his production line. "Under normal capacity, this line would be running at full load with shoes everywhere, in every corner. But now, due to the reduction in orders caused by the high tariffs, our line's workload is below normal capacity," he said. Hajel noted that 25 to 30 percent of his factory's output was previously destined for the North American market. His workforce has been cut by 40 to 50 percent, down from 120 employees.
Workers are feeling the uncertainty. Graca, an employee at another Franca factory, said, "We are very anxious right now. We don't know what will happen next."
Local officials are responding by trying to open up alternative export markets to cushion the blow from the US measures, though the immediate outlook for the city's shoemakers remains uncertain.