American Apparel facing possible shutdown

About 200 American Apparel employees at the Oneonta plant were laid off two weeks ago, according to plant manager Tom Reeves, who confirmed the layoffs as a result of The Blount Countian’s inquiry yesterday. The layoffs are considered temporary for the time being, he said, though he was not optimistic about prospects for employee recall. Only six to eight employees remain and are cleaning the building, he said.

“The building is still here and the machines are still in place but we’ve sold all our stock out and are awaiting word from the owners as to what they’re going to do,” he said. No firm decision to close the Oneonta plant has yet been announced.

Reeves said the reason for the temporary shutdown was that the U.S. Department of Defense, which contracts with manufacturers for the military uniforms produced by American Apparel, has released no further contracts for the company to bid. He attributed that to cost reductions such as the sequester which have reduced the government’s available funds for purchasing military goods and supplies.

“It’s been a great run for American Apparel here in Oneonta, and this plant has had a great reputation for quality,” he said, adding that other opportunities for clothing manufacture could possibly turn up at any time, although prospects for diversifying into other retail clothing lines are not favorable because of intense foreign competition.

American Apparel began its Oneonta operations in December 2005, after being recruited to the former Wrangler plant by former Chamber of Commerce executive director Charles Carr. The firm employed about 250 at the height of its operation, and had maintained a level of about 200 since that time.