Hanesbrands To Close Nine Plants Globally

“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,” said Gerald Evans, Hanesbrands president, chief global supply-chain officer. “We regret that employees will be affected by this production streamlining, but our supply-chain globalization is necessary to strengthen our overall company and keep us competitive around the world.”

The textile production from the latest closings will be absorbed into existing textile plants in Central America. Hanesbrands has expanded its fabric production capability offshore in the Western Hemisphere. The company has reached planned fabric production levels at its textile facilities in the Dominican Republic and El Salvador, with further expansion planned in Central America.

Most of the sewing production from the Central American plants that will close will be moved to the company’s new Asian facilities. Hanesbrands has opened or acquired four sewing plants in the past two years - two in Thailand and two in Vietnam. Hanesbrands expects to increase its workforce in Asia from 4,000 today to 6,000 by the end of 2008.

“Our startup of supply-chain operations in Asia is progressing very well,” Evans said. “Since acquiring our first sewing operation in Chonburi, Thailand, in 2006, we have doubled production at that plant with the same number of operators, as we bring to bear our production and plant operations expertise. Operations in Vietnam are starting very fast with excellent quality from a very capable workforce.”

The company is also constructing a textile fabric plant in Nanjing, China, which is expected to begin the ramp up of production in 2009 to supply fabric to the company’s expanding Asian sewing network.

2008 Actions by Country

In El Salvador, the company is ceasing most production this week at its Pedregal sewing plant near San Salvador, affecting approximately 1,900 employees. All production is expected to end by the end of the first quarter in 2009, affecting another 700 employees.