Shinola, the Detroit-based maker of retro-classic watches, bicycles, and leather goods has only been around for about five years, but has already established itself in the realm of high-end American accessories. The brand has opened stores in cities including London, Los Angeles, New York, and Miami; its watches are among Google’s top-searched gifts this holiday season; and public fans such as Bill Clinton tout the company as an “American success” story.
All along, Shinola has capitalized on optimistic images of post-recession, bootstrapping Americans, with the slogan, “Where American is made.” Its watches are stamped “built in Detroit.”
Now, the US Federal Trade Commission (FTC), which controls the standards for the “Made in USA” label, has suggested that such labeling deceives customers. An FTC spokeswoman suggested to the Detroit Free Press that consumers would likely perceive a label like “Built in Detroit” as no different from “Made in USA.” Because Shinola’s watches contain Swiss movements—the essential time-keeping components—they would fail to meet the FTC’s standard that “Made in USA” only be applied to products that contain, at most, a “negligible” amount of “foreign content.”
Shinola has been transparent about the presence of Swiss parts in its watches, which stands to reason. The company is partially owned by Ronda AG, a Swiss-based manufacturer of watch movements. In a video on Shinola’s website, Hanspeter Herzog, Ronda AG’s head of technical services, figures prominently, explaining how Swiss parts make up Shinola’s timepieces, which are then assembled in Detroit.
“All the components are produced in Switzerland,” says Herzog in the video (1:23).
“All we need is the proper assembly of the components, it’s like on a car—a good car—it’s only a good car if everything is good quality, and assembled the right way. We can bring the knowledge, but the people are still the most important element. By the training they have from our crew, there is no reason why this quality we have already achieved can’t be transferred to Detroit.”
Shinola maintains that the “Built in Detroit” slogan is an honest reflection of their assembly process, and not a deceptive label. ”We believe that ‘Built in Detroit’ accurately reflects what we are doing here and believe wholeheartedly that anybody who would come to our factory and witness our process, would think so too,” the company told the Detroit Free Press, in a written statement.
In November, the FTC told the Kansas City-based watch brand Niall to walk back its “Built in USA” marketing, since the movement comes from outside the US. Niall CEO Michael Wilson suggested the FTC’s standard for “Made in USA” is too stringent.
“There’s nobody in America that currently meets the FTC standards of American made,” Wilson said. “And anybody who does claim it could be facing potential investigation by the FTC, and if it was shown to be malicious, they could be fined.”
Certainly somebody in America must meet the current FTC standard, but Wilson has a point. In the age of the global supply chain, it may be time to re-examine what it means to be Made in USA—or, like Shinola, just try to rewrite the slogan.