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  • Writer's pictureThe San Juan Daily Star

Adidas ends partnership with Kanye West at a considerable cost

Kanye West, now known as Ye, in New York, Sept. 12 2022. The German sportswear giant Adidas is the latest company to cut ties with the rapper and designer over his antisemitic outbursts and other provocations.

By Melissa Eddy, Vanessa Friedman and Michael de la Merced

For more than two weeks, as Kanye West made a series of antisemitic remarks and embraced a slogan associated with white supremacists, Adidas, the most important partner in his fashion empire, said only that its relationship with the rapper and designer was “under review.”

But as Ye, as West is now known, continued his offensive behavior, and with the condemnation of his remarks growing more widespread, Adidas announced earlier this week that it would cut ties with him — a move the company said would cost it 250 million euros ($246 million) this year.

The end of their nearly decadelong partnership — which one estimate said was worth close to $100 million annually to Ye — raised questions of what would come next for Ye, who has been one of the most influential pop stars of recent decades but has become increasingly polarizing and unreliable. CAA, Ye’s former talent agency, no longer represents him and Def Jam, his longtime record company, said that his contract had expired last year.

“Adidas does not tolerate antisemitism and any other sort of hate speech,” the company said in a statement. “Ye’s recent comments and actions have been unacceptable, hateful and dangerous, and they violate the company’s values of diversity and inclusion, mutual respect and fairness.”

The company, based in Herzogenaurach, Germany, said it would terminate the partnership immediately, end production of Yeezy branded products and stop payments to Ye and his companies.

Over the past month, Ye tested the boundaries of acceptable behavior even for a noted provocateur. At his YZYSZN9 Paris Fashion Week show, he wore a shirt with the slogan “White Lives Matter,” which the Anti-Defamation League has identified as hate speech and has been adopted by the white supremacist movement. He made antisemitic remarks on social media and in interviews shortly after, including a post on Twitter that said he would go “death con 3 ON JEWISH PEOPLE.”

Blowback quickly followed.

Instagram and Twitter suspended Ye’s accounts. Ari Emanuel of Endeavor, the parent company of the talent agency WME, called on entertainment companies to stop working with Ye. Balenciaga, the fashion house that had partnered with Ye in his Yeezy Gap project (which came to an end in September) and opened its runway show in Paris this month with a modeling stint by Ye, deleted him from its pictures and videos of the show. Similar images disappeared from Vogue Runway, the platform of record for fashion shows, and the magazine stated it “had no intention” of working with Ye in the future. Vogue magazine said it would no longer work with Ye, who had appeared on its cover with his ex-wife, Kim Kardashian, and often attended the Met Gala.

On Monday, studio MRC said it was shelving a documentary on him. Gap, which had a partnership with Ye that ended last month, said Tuesday that it was taking “immediate steps” to remove Yeezy Gap products from its stores and had shut down an affiliated website. Also on Tuesday, Aaron Donald of the Los Angeles Rams and Jaylen Brown of the Boston Celtics said on Twitter that they were cutting ties with Donda Sports, Ye’s marketing agency, because of the antisemitic remarks.

Although Adidas was among the first of Yeezy’s corporate partners to announce publicly — on Oct. 6 — that it had placed the relationship under “review,” the fact that the company did not move faster to officially sever the ties began to take a toll. The Anti-Defamation League shot back, “What more do you need to review?”

Like many of Ye’s other fashion connections, Adidas seemed to be dragging its feet, perhaps hoping for a public apology that could turn things around. Unlike Ye’s other fashion relationships, which were largely unofficial and based on mutually advantageous appearances, untangling the deal between Yeezy and Adidas would have major contractual and long-term implications; the two brands were intertwined not just publicly, but financially and logistically as well. For Adidas, the partnership was worth more than 10% of the more than $2 billion it made in profit last year.

The Anti-Defamation League stepped up its pressure on Adidas this week, after members of a hate group hung a banner reading “Kanye is right about the Jews” over a Los Angeles freeway.

In Germany, the Central Council of Jews called on the company to cut ties to Ye. “The historical responsibility of Adidas lays not only in the German roots of the company, but also in its entanglement with the Nazi regime,” said Josef Schuster, the head of the council. “I simply expect such a company to take a strict position regarding antisemitism.”

The founder of Adidas, Adi Dassler, belonged to the Nazi Party, and his factory was forced to produce munitions in the final years of the war. It was only thanks to the sworn statement of a Jewish friend that he was allowed to found the present-day company after World War II ended. Antisemitic statements made online can lead to prosecution in Germany, and companies with ties to the Nazi era are expected to act to prevent the return of such sentiment.

As pressure on the company mounted in the United States in recent days, its leadership remained largely silent, frustrating even its own executives. “Coming off of the Adidas global week of inclusion, I am feeling anything but included,” Sarah Camhi, a director for trade marketing at Adidas in the United States, wrote in a post on LinkedIn on Monday.

Shares of Adidas ended the day down 2.4% on Tuesday. The company’s stock has fallen more than 20% in the past month, as Ye embarked on his latest bout of outrageous behavior.

Adidas, which began collaborating with Ye after he left Nike, has long weathered public barbs from the rapper. The value of its partnership with Yeezy, Ye’s company, which encompasses sneakers and clothing, has never been disclosed, but in a recent report, David Swartz of the research firm Morningstar estimated it to be worth about 1.5 billion euros to 2 billion euros. Royalty payments to Ye are also undisclosed but are “likely to exceed 100 million euros per year,” Swartz said.

For Adidas, working with Ye gave the company a boost of creative cool and credibility that helped attract high-fashion collaborators such as Gucci and Balenciaga.

Ted Deutch, the CEO of the American Jewish Committee, said he welcomed “this decisive if belated action by Adidas.”

“He believed that as long as the money kept rolling in he could speak with impunity,” Deutch said of Ye. “Other companies that profit from associating with West must also disabuse him of that notion.”

Ye has stated that he plans to open his own retail stores, as part of his rejection of the corporate world and creation of what he has reportedly called the “Yecosystem.”

But the future of the Yeezy brand is unclear. Ye still owns the Yeezy trademark. However, Adidas said in its statement that it was the “sole owner” of all design rights to existing products that came out of the partnership, as well as previous and new colorways arising from the collaboration.

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