The 2017 American Apparel Layoffs Have Begun

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American Apparel Inc layoffs are on the horizon after the retailer failed to sell some of its assets to a Canadian apparel company.

American Apparel layoffsGildan Activewear Inc (NYSE:GIL) had stated interest in acquiring some of American Apparel’s operations after the retailer filed for bankruptcy. An $88 million bid was filed that would offer Gildan access to some of the retailer’s manufacturing operations.

The fact that American Apparel’s products come with the “Made in the U.S.A.” tag made the company particularly appealing to others, but it appears as if Gildan is backing out, putting American Apparel in a tough position.

The employees who are at risk of losing their job include the 2,166 workers at the company’s headquarters in Los Angeles, as well as the 959 workers with positions at the South Gate manufacturing facility.

Gildan has 42,000 employees, and nearly 90% of these are not located in North America. In fact, they are scattered throughout the Caribbean and Central America due to lower costs. Often times, these workers perform their labor for very low wages and difficult conditions, making their products inhumane in the view of others.

It would be considered to be a major coup to win over American Apparel’s operations as it would make some consumers feel much more comfortable about buying the company’s products knowing that they were produced in positive working conditions.

There are other potential buyers that have explored the possibility of acquiring American Apparel’s assets.

GIL stock is up 0.8% Tuesday.

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Article printed from InvestorPlace Media, https://investorplace.com/2017/01/american-apparel-layoffs-2/.

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