US: New Era Cap to close Alabama plant
Headwear maker New Era Cap Co Inc is to close its plant in Demopolis, Alabama and keep its factory in Derby, New York as the company's sole US manufacturing facility.
The decision will lead to the loss of around 350 jobs at the Demopolis site.
The two plants were put on notice last November after New Era decided to consolidate its domestic manufacturing operations in the wake of lower demand for its US-made products.
The company at the same time it would also close its Jackson, Alabama plant.
"This was an incredibly difficult decision to make," said Christopher Koch, CEO of New Era.
"Both our Demopolis and Derby plants are highly efficient and have made enormous contributions to New Era's success over the years.
"In the end, our decision to keep Derby open was based largely on the need to retain our most senior and experienced unionised employees."
The company also said that keeping the Derby plant open would mean less disruption to its cap production operations since the Demopolis plant would require "significant renovation" if it was to serve as the company's US production base.
A final agreement on the decision now hangs with the 330 Derby workers, who still need to approve a new contract that includes operational efficiencies and cost savings.
If the agreement is ratified, New Era said it will close its plant in Demopolis, Alabama sometime in the second quarter of this year.
The closure comes as New Era makes efforts to expand its retail and private-label lines beyond headwear with the acquisition of Miami-based apparel manufacturer 5th & Ocean.
5th & Ocean is a privately held firm that makes sports and fashion apparel for men, women, and kids, with customers that include major US sports leagues and retailers such as Victoria's Secret/Pink.
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