Bye, bye America: Levi Strauss shuts last of its North American plants in Texas

indianexpress.com ^ | Saturday, September 27, 2003 | LESLIE EARNEST

[Destro]

Saturday, September 27, 2003

Bye, bye America
Levi Strauss shuts last of its North American plants in Texas

LESLIE EARNEST

SAN ANTONIO, SEPTEMBER 26: Levi Strauss & Co., maker of a jeans brand so all-American that it became ingrained in the nation’s identity, said on Thursday that it will close the last of its North American manufacturing plants, laying off almost 2,000 workers.

The announcement came two weeks after the San Francisco-based company, which is struggling to cut costs and stay competitive, said it would lay off seven per cent of its US workforce. Levi now says it will shutter two plants in San Antonio, Texas by the year’s end, displacing 800 workers and marking the end of US operations.

It will also discontinue its Canadian operations in March, erasing 1,190 jobs in Alberta and Ontario. Its goal is to focus resources in other areas, including development and marketing. ‘‘We’re in an industry where few apparel brands own and operate manufacturing facilities in North America,’’ Chief Executive Phil Marineau said. ‘‘In fact, we are one of the last companies to do so.’’ Last year, 96 per cent of apparel purchased in the US was made in other countries, up from 93 per cent in 2001. Through June this year, US apparel imports increased 16.7 per cent, with much of it coming from Mexico, Central America and China.

Over the past seven years, Levi has closed dozens of plants in North America and Europe and slashed thousands of jobs. Last year, it posted sales of $4.2 billion. The jobs lost at Levi plants in North America are likely to shift to Latin America and Asia, Levi spokeswoman Linda Butler said. Levi now works with about 500 contractors, producing apparel in 50 countries.

Levi is simply adapting to a reality that many other US apparel makers have had to face, Burke said. ‘‘What you’re seeing with Levi is just the economic reality of our industry,’’ Burke said. ‘‘American consumers, when shopping look at price and quality, and not necessarily to where the product is made.’’ But experts say few, if any, brands are as linked to the US landscape as the Levis.

Levis has been a symbol of US spirit since prospectors rushed into California 150 years ago, wearing Levi jeans with copper rivets. ‘‘As the miners went into the Sierra Nevadas to pan for gold, Levi stood the test,’’ said Peter Sealey, adjunct professor of marketing at the University of California. ‘‘That created the company’s image and history.’’

To many consumers, Levi was a symbol of ‘‘confidence, sex, youth, rebellion, freedom, originality and authenticity,’’ said Alex Wipperfuth, partner at Plan B, a marketing company. ‘‘Those are the dimensions of Americana, according to Levi,’’ he said.

‘‘I think the key issue is, will any of those fall away once people realise Levi is not produced in the US anymore?’’ (LAT-WP)

[L.N. Smithee]

What are you all talking about? Levis is not going out of business!

Yet.

[TheBattman]

Are Wranglers still made in the USA?

How about Carhart?


Just more reason to tell Levi's to go take a jump.....

The Levi's Brand clothing hasn't gone down in price (at least not the pants), yet they have supposedly been moving their manufacturing out of country as a cost cutting move..... Where's MY cost cutting? So now a pair of Levi's that use to cost $4.00 per pair to make in the US, now costs $1.75 per pair to make elsewhere. That same pair of jeans will still cost $55 in the store.....

Even if Levi's cut is only $10.00 per pair (really doubtful), I don't see how 150% profit per unit looses money.....

[JohnSmithee]

"Does anyone know of any jeans or clothing garments that are actually made in America. I just walked to the restroom and dropped my J. Crew khakis and saw that they were made in Malayasia, my shirt (polo golf) was made in Guatamala, my t-shirt (polo) was made in the Domican Republic, my shoes (adidas) were made in Indonesia, and my underwear (tommy hilfigure) were made in China."

One of the problems with outsourcing is the manufacturing inconsistency between different locations. Some of the best white dress shirts used to be made in Hong Kong, but I haven't seen it in awhile. Now, "white" shirts are no longer white, the cloth style changes every few months, and shirts no longer fit "properly".

"Do Americans produce anything anymore besides crappy movies and ciggerettes?"

The United States is still one of the biggest exporters in the world, but seems to be giving up the domestic market of consumer goods.

[Bonaparte]

"Levis is not going out of business!"

Did you see the article I linked in post 18? Levi Strauss has made all the wrong moves for the past 6 years and the same management continues to fumble the ball. They floated a bunch of bonds that now have "junk" status, are trading well below par and have been shorted like crazy. This debt is now rated as "junk B."

Here is the basket they are currently putting all their eggs into. It will market at most or all Walmarts for around $30-$35. Real exciting product, isn't it?

[Bonaparte]

LS has been steadily losing market share. Their competitors have been elbowing them aside for years. The most lucrative consumer group are teenagers and they are not interested in Levi's. It's not about profit margin per unit, it's about not being able to sell enough units. At least, not in America.

[Destro]

AND IT STILL MADE RECORD PROFITS.

[Bonaparte]

"In fact it had record profits this year."

From the article I linked in post 18:

The company will finish this year with just under 12,000 employees, down from 17,300 at the end of 2000. Its revenues are expected to be $4.1 billion, about flat with last year, but way down from $7.1 billion in 1996, the year that a growth spurt fueled by its Dockers brand started to run out of steam.

[Bonaparte]

Allegations Levi Strauss Falsely Inflated Profits

[Destro]

profit is profit. Why are we having this conversation? Jobs are gone from a brand that was able to be manufactured in the USA for a 150 years. It is leaving this nation behind and taking its jobs with it. The Levis Strauss company will still be in business-making more money per jean then they do now thanks to cheap labor and it will still be able to fund whatever gay parade it so damn pleased maybe even more so now that it can make more profit per jean.

[Bonaparte]

Here is a 4-year-old article that should give you some idea of how badly this company has been managed.

[Bonaparte]

I don't think you understand their position, Destro. They are too deep in debt and can't move enough product. They have less than a year to turn all this around or they are toast. Bob Haas has even been lying about his profits in a futile effort to keep the wolves from his door.

[Chancellor Palpatine]

Damned Straussian neocon free traitors.....

[altura]

Well, yeah ... my son-in-law works there.

And, by the way, Levi Strauss was the last holdout to try to keep its manufacturing in the U.S.

All those competitors you people are so anxious to patronize because of the so-called gay agenda were long gone years before Levi finally gave up.

[Revolting cat!]

Be thankful, the jobs are still here, only they are different, uhm, information age jobs. These jean companies cum fashion houses spend more on marketing than on manufacturing these days. Be a model, a gofer on a photo set, or a walking sandwich billboard!

[Bonaparte]

Let me put it this way, D -- Last year (2002), Levi Strauss saw profits of only $25 million. The year previous to that (2001), Levi Strauss saw profits of $151 million. And if you draw a line on a graph, a line that runs from the profits point in 1997 (on the left) to the pathetic profits point in 2002 (on the right), you will see something like this:

\

[Texas_Dawg]

Damned Straussian neocon free traitors.....

Is there anyone in the world who isn't a RINO or neocon yet?

[Destro]

and what? Your point is that because of that it is better they give the job over to a Mexican in Mexico earning Mexican wages as opposed to say a Mexican in Texas earning American wages? What does your "cheering" do for the American manufacturing jobs lost?

[Revolting cat!]

Oh, no, Korean_Chow showed up and we'll have 400 posts of inane arguments about "capitalism" and Freddie Hayek!

[Destro]

who??

[novacation]

I quite buying Levi's overpriced jeans years ago.They're really going to fit badly when they start making them in China. Things change.They can't stay the market leader forever.