Founded in 1989, Los Angeles-based apparel manufacturer and retailer American Apparel is recognized as one of the largest and trendiest clothing brands in the United States. Aside from being the iconic brand of the millennial hipster movement, the fashion company also prides itself on their long-held “made-in-the-US” heritage.
However, after filing for bankruptcy in November of 2016, American Apparel was put up for auction. This past week, Canadian apparel giant Gildan Activewear acquired American Apparel for $88 million, inheriting both the company’s manufacturing equipment and intellectual property rights. Gildan did not assume the leases of their California manufacturing plants, leaving many to question whether American Apparel clothing will still be produced in the United States or not.
If Gildan decides to run the newly acquired company as they do their own, chances are American Apparel will shed their proudly worn “made-in-the-US” title. About 90 percent of Gildan’s workforce is based overseas, and the only clothing items they manufacture in the US are socks.
According to Garry Bell, a spokesman for Gildan, the company has not yet decided where the clothing will be produced, but will sort the issue once the acquisition is complete. Prior to the auction, which also drew interest from Next Level Apparel, Amazon, and Forever 21, American Apparel insisted that keeping their manufacturing facilities in the US would be a part of any deal agreed upon.
3,500 American Apparel employees have already received notices informing them that they could be laid off in coming months. A majority of the workers in their Los Angeles-based plant are immigrants who earn minimum wage, and are now facing uncertainty about their employment.
The struggle to keep jobs in the US became an especially sensitive political topic during this last election. In fact, preventing manufacturers from moving overseas was one of the key campaign promises of President-Elect Donald Trump, which inevitably helped him clinch the blue-collar vote by a sizable margin.
While the incoming president has claimed that he will be the “greatest jobs producer that God ever created,” chances are he won’t acknowledge the possibility that one of the largest clothing manufacturers in North America may soon be leaving the US. A true master of distraction, Trump has made bold promises to the American people about creating jobs, but whether or not he will keep those promises remains to be seen.
Unsurprisingly, Trump’s team has refrained from commenting on the American Apparel acquisition, much like they did when Macy’s recently announced that almost 11,000 employees would be laid off.