Hanesbrands will close 9 plants, cut 8,100 jobs |
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| Thursday, 25 September 2008 | |
 Apparel maker Hanesbrands Inc. announced it will close nine plants across five countries and cut 8,100 workers as it seeks to reduce costs. Hanesbrands, the largest U.S. maker of T-shirts and socks, and behind the brands Hanes, Champion, Playtex and Bali, is shifting production to countries where
labor costs are lower, particularly in Asia. The moves will eliminate the jobs of workers in the United States and Central America, while the company plans to add 2,000 jobs in Asia. North Carolina-based Hanesbrands has about 50,000 employees in 25 countries.
As part of the current restructuring, Hanesbrands is expected to close seven plants by the end of 2008- a sewing plant in El Salvador, affecting 2,600 employees; a sewing plant in Honduras, affecting 1,250 employees; a sewing plant in Costa Rica, affecting 1,250 employees; and two yarn plants, a knit-fabric textile plant and an inventory storage warehouse in the United States, affecting 745 employees. By the end of summer 2009, the company also expects to also close a sewing plant in Mexico, affecting 1,650 employees, and close its last large knit-fabric textile plant in the United States, affecting 600 employees. The consolidation will cost about $76 million. The closings complete the migration of the company's large knit-fabric textile production from the United States. Textile production from the plants closed will be absorbed into existing plants in Central America. Most of the sewing production from Central American plants that are closing will be moved to the company's Vietnam and Thailand plants. Hanesbrands expects to increase its work force in Asia from 4,000 today to 6,000 by the end of 2008. "In addition to improving cost competitiveness, these moves will lay the foundation for completing our Asia build out and improve the alignment of our sewing operations with our end-state flow of textiles," added Gerald Evans, Hanesbrands president, chief global supply chain officer. "We regret that employees will be affected by this production streamlining, but our supply chain globalisation is necessary to strengthen our overall company and keep us competitive around the world." Image: underwear label |
"Globalizing our supply chain, and eventually balancing production between Asia and the Western Hemisphere, is a critical plank in our strategic efforts to reduce costs, improve product flow and increase our competitiveness," said Hanesbrands Chief Executive Richard A. Noll in a statement.