Levi Strauss cuts another 2,000, shutters U.S. plants

San Francisco Business Times ^ | 9/25/03

[Willie Green]

For education and discussion only. Not for commercial use.

San Francisco blue jeans maker Levi Strauss & Co. said Thursday it would close its remaining North America manufacturing and finishing plants, firing nearly 2,000 employees in the process, or about 11 percent of its global workforce.

The news comes days after the company said it would cut bout 350 salaried jobs in the U.S., with about 300 additional jobs cut in Europe in an effort to reduce costs in the face of reduced product pricing.

In April 2002, Levi Strauss closed six of its eight U.S. manufacturing plants, including its oldest on Valencia Street in San Francisco. The closures pink slipped 3,300 employees, or 20 percent of Levi's worldwide workforce.

The sewing plants closed in three phases and included four in Texas, and one in Georgia.

During that 2002 round of closures, there were 100 layoffs in San Francisco, where Levi had made jeans in its Mission District facility since 1906. The closures were part of Levi's turnaround plan, which involves getting out of manufacturing to focus on marketing. The company has been losing sales and profits for half a decade and has shifted manufacturing to offshore contractors like many of its competitors.

The remaining two U.S. plants were in San Antonio Texas.

[Bringbackthedraft]

So much for "Look for the Union Lable".

[theDentist]

No more Levi's for me.

[joesnuffy]

Wranglers...
levis are for social liberals

[ARCADIA]

I use to think that it ment something else; but, now a "booming" economy is probably when the ex-workers take up arms and start shooting.

[Hodar]

It used to be that there were only a few competing manufacturer's for Blue Jeans. Wrangler, Levi and Lee jeans (plus a handful of me-too producers). Now, we have a gazillionty makers, including designer labels (Polo, GAP, Tommy Hillfiger), and Levi and Lee have been thrown out in, to make way for new and trendy fashion statements.

These companies are fighting in a industry that has the prices remaining static for the past 30 years (I bought jeans for $20 at Sears in 1979; and I can get the same jeans at Sears today for $20). Unions don't help matters.

One of the downsides of having only a single staple in your industry, is that when your product loses mass appeal, you will go down with the ship. For example, Dell now sells PC and Printers (soon HDTV's, MP3 players, cameras, ect). Other companies with only a single 'product' are going to go bust when they no longer command the mass appeal (attention Nike and Rebok).

[El Gato]

San Antonio Express News Article.

NEW: Levi Strauss to close plants here by year's end

By Elizabeth Allen
Express-News Business Writer

Web Posted : 09/25/2003 10:42 AM

Levi Strauss & Co., in its continuing efforts to cut costs, will close the two San Antonio plants that sew and finish its jeans by year’s end, putting 800 people out of work and ending the company’s manufacturing history in the U.S.

"It’s critical to the company’s long-term competitiveness that we continue our ongoing shift away from manufacturing toward becoming more of a marketing and product-focused company," said Levi spokeswoman Katie Otto.

What that means is that the company is contracting with manufacturing plants in other countries to produce its designs at a lower cost.

San Antonio’s plants were the company’s last two U.S. plants. Otto said the sewing facility, which employs 550, and the finishing plants, where 250 people work, will close by the end of the year. She said employees will be offered a severance package that Levi is still negotiating with the Union of Needletrades Industrial and Textile Employees.

The company will also offer employees help in looking at their future options, writing resumes and searching for new jobs. Some of that will be direct help and some will be through grants to local organizations.

"We have established a community transition fund with more than $700,000 in grants," Otto said. "We still need to identify those organizations."

Levi plants once dotted the region from San Angelo to the Rio Grande Valley. But for years that company and other clothing manufacturers have been shutting down their North American plants and moving the business offshore to cheaper sites.

Otto said the contracting facilities will have to agree to a "very strict code of conduct" in providing a "safe and respectful" workplace.

eallen@express-news.net

[MD_Willington_1976]

Levi's is doing the same thing in Canada...Probly moving there shops to China or Mexico...

Levi Strauss closing three Canadian plants
United States (Sep. 25, 2003 - 10:56)

From Webfin.com

http://www.webfin.com/en/news/news.html/?id=39153

RICHMOND HILL, Ont. (CP) -- Jeans maker Levi Strauss & Co. is closing its three remaining manufacturing plants in Canada next year in a restructuring that will cut 1,180 jobs.

The U.S. clothing giant said Thursday the move continues the company's drive begun in the late 1990s to shift all its manufacturing to outside suppliers and away from owned and operated plants.

The three Canadian plants affected are sewing operations in Edmonton and Stoney Creek, Ont., near Hamilton, and a finishing centre in the southwestern Ontario community of Brantford. A plant in Texas is also being closed.

The closures are expected to occur by next March.

"Our employees have done a tremendous job and these closures are in no way a reflection on their good work," said Julie Klee, general manager of Levi Strauss & Co. (Canada) Inc. "As painful as they are, however, the closures are an absolutely necessary part of ensuring the long-term competitiveness of our business.

"Moving away from owned-and-operated manufacturing to a broader sourcing base will strengthen our business by giving us much more flexibility. It will allow us to use the right sources - with the capabilities and cost-competitiveness that we need - to get a wider range of products to market faster.

Klee said the closures will allow the company to focus on product design, marketing and sales of its jeans.

The company said it intends to offer a comprehensive separation package to affected employees and will meet with unions in coming weeks to discuss the move. As well, the Levi Strauss Foundation has set up a $700,000 US transition fund to help the three affected communities.

Levi Strauss Canada, headquartered just north of Toronto, is the wholly owned subsidiary of Levi Strauss & Co., one of the world's leading branded apparel marketers. In Canada, the company markets and sells jeans, casual wear and accessories under the Levi's, Dockers, GWG and Levi Strauss Signature brands.

[TopQuark]

Meet Willie Green, the peddler of anti-corporate and anti-capitalist news on FR.

[TopQuark]

Why not? Because they layed off people? Would it have been better if they were not hired in the first place?

[TopQuark]

"booming" economy is probably when the ex-workers take up arms and start shooting.

At whom?

How is your statement different from burning houses of the wealthy and destroying factories, as advocated and practiced by the communists?

It's nice to know that conservatives think as you do.

[ARCADIA]

Meet Willie Green, the peddler of anti-corporate and anti-capitalist news on FR.

It is just the facts. If you have better information, go ahead and post it.

[TopQuark]

I bought jeans for $20 at Sears in 1979; and I can get the same jeans at Sears today for $20

This means they are twice cheaper than they 20 some years ago.

[TopQuark]

I am not against the facts, of course. But selective attention to them is propaganda. And that what Willie Green does: posts exclusively anti-corporate and anti-capitalist pieces, often from really poor sources.

Other facts? Well, the unemployement is 6.1% which until very recently was considered minimal possible. Great news.

[A. Pole]

"It’s critical to the company’s long-term competitiveness that we continue our ongoing shift away from manufacturing toward becoming more of a marketing and product-focused company," said Levi spokeswoman Katie Otto.

Unemployed workers will not buy the products. No tariffs - no economy.

[ARCADIA]

It's nice to know that conservatives think as you do.

There is nothing conservative about the priviledge few selling out their country for a pile of money. That is what globalism is all about, and I have no problem destroying those who would destoy everything that we believe in. You are defending the people who endorse our continuing business with communist China, and other Socialist states. It is there brand of "conservatisim" that you should question.

[ARCADIA]

It is there brand of "conservatisim" that you should question.

"there" s/b "their" (sorry)

[A. Pole]

There is nothing conservative about the priviledge few selling out their country for a pile of money.

The root of the problem is not greed, but the lack of proper tariffs ("free" trade). When the proper tariffs are missing, companies that try to employ Americans are penalized and driven out of business.

"Free" trade pushes companies to relocate the production to the cheap labor countries. This results in trade deficit and budget deficit as imports increase and the tax base decreases.

The "free" market correction will consist of collapse of the dollar value and unablity of American consumers to buy imported products. This will resemble the Russian crisis of 1998 at the best or Argentinian crisis at the worst.

[TopQuark]

There is nothing conservative about the priviledge few selling out their country for a pile of money.

You are poorly informed and brainwashed by newspapers.

Most of our corporations are owned by "simple folks" -- through their pension funds and stock portfolios. The owners --- that, I am sure, includes you --- hire the management to make profit for them. Management of a top company requires a great deal of talent, which costs a lot of money, and that money is paid it the form of high salaries, options, etc. There is nothing privileged about that: these people made sacrifices most people do not, work extremely hard, and make a buck utilizing their talents. There is nothing more American than that.

Pressed by owners --- which, again, includes you -- to make a profit, the managers seek the best possible course of action. If a less expensive office supplier becomes available, they switch to that supplier. If a less expensive programmer becomes available, they do the same.

As for continuing business with communist China and other "Socialist states," you should be aware that (i) we have always done that with communist countries, (ii) it is a question of foreign policy unrelated to this thread, (iii) all of Europe is now socialist --- with whom do you suggest we trade?

Now, since you are a real conservatice, why is it that you exhibit misunderstandign or lack of knowledge on these rather fundamental issues?

The comments on this board indicate that within 20 years or less we will have a full socialist regime here. Ignorance of how the core American institutions work, coupled with purely socialist envy constantly fueled by the elites will lead to that ourcome.

[theDentist]

No. because they closed their last plant in North America. I'm trying to buy primarily American. I know so many products are imported, or a majority of the parts are imported and assembled here, but when I can, I try to buy American made products. OK? Good enough for you?