(Adds background on retail availability)
By Allison Lampert and Jessica DiNapoli
MONTREAL/NEW YORK Feb 23 Canada's Gildan
Activewear Inc plans to keep making key styles from its
recently acquired American Apparel brand in the United States
but will also manufacture some products elsewhere, a company
spokesman said on Thursday.
In January, Gildan won a bankruptcy auction to acquire the
edgy fashion brand's manufacturing equipment and intellectual
property rights for about $88 million in cash, leaving American
Apparel's made-in-the-U.S.A. heritage uncertain.
Gildan will use contractors in the western United States to
make core American Apparel styles, spokesman Garry Bell said by
phone. Other items, however, will be made at Gildan plants
outside the United States.
"We're definitely going to manufacture product in the U.S.A.
and support made-in-USA product," Gildan Chief Executive Officer
Glenn Chamandy told analysts on Thursday during an earnings
call. "At the same time, we think that there's an opportunity to
offer product that's more price-centric."
Keeping jobs in the United States has become a hot-button
political issue since President Donald Trump campaigned on
stopping manufacturing moving overseas.
Nearly 90 percent of Gildan’s 42,000 employees are in
low-cost Caribbean and Central American countries. While the
company makes yarn in North Carolina and Georgia, socks are the
only apparel it manufactures in the United States.
Gildan, which competes with Hanes Brands Inc, expects
to integrate American Apparel's customer service, web platforms
and product distribution into its wholesale printwear business,
in March. Chamandy said he expected Gildan's distribution
network to boost American Apparel's international sales.
Gildan, which did not acquire American Apparel's 110 stores,
is still assessing how to market the brand, its highest priced
product line, directly to consumers. The clothing and other
merchandise will be available online and in stores at least
through the beginning of April.
American Apparel filed its second bankruptcy in as many
years in November with about $177 million in debt after a
turnaround plan failed.
"We're going to make sure, as we go forward, that the brand
is relevant with consumers, which we think will continue to help
drive our printwear business," Chamandy said.
Chamandy said Gildan would run a small American Apparel
office in Los Angeles to keep the "heritage of the brand alive,"
while using social media platforms to promote it.
American Apparel was known for operating some of the largest
private garment-making operations in the United States, along
with its racy marketing campaigns.
Last month, the company began laying off 2,400 workers in
(Reporting by Allison Lampert in Montreal and Jessica DiNapoli
in New York; Editing by Lisa Von Ahn and Andrew Hay)