Denim Mills Continue to Look to Mexico
The past 10 years has seen a shift in a large portion of California production to Mexico and the manufacturers of jeans have been a significant part of that shift.
Mexico surpassed China as our number-one apparel and textile-trading partner in 1997, and continues to widen the gap. Growth in all apparel and textile sectors is expected to continue as Mexico makes a transition to becoming more of a “full package” production supplier combined with an expected liberalization of the Mexico banking system under new President Vicente Fox.
Few if any of the U.S. textile mills and denim producers are aglow with increased profits today. Many say these are as tough of times as any in recent memory. Yet U.S. mills and manufacturers—particularly some of the largest denim mills and jeans makers—continue to look to Mexico for expansion opportunities.
Greensboro, N.C.-based Cone Mills, one of the largest denim producers with 2000 sales in excess of $600 million, has invested heavily in both a joint venture “package production” facilities in Puebla, Mexico, as well as a recent 35 percent expansion program of their joint venture denim mill with Parras S.A. de C.V. Additional plans call for a new denim facility to be built in Altamira, Mexico.
“Over the past five years, sourcing of denim jeans for U.S. markets from Mexico has more than doubled,” according to Cone Mills CEO John L. Bakane.
New York-based Galey & Lord is another major denim manufacturer with a heavy presence in Mexico. The company’s Swift division and Klopman Group operate six facilities in Mexico.
Greensboro, N.C.-based Burlington Mills is plagued with continued financial problems, but still makes major commitments to its Mexico position and is one of the largest textile and apparel employers south of the border, with a total of over 4,000 employees and operations in nine plants, according to company reports.
The company plans to concentrate on its presence in Mexico and CBI countries because of its quick access and proximity to U.S. markets as opposed to Pacific Rim markets.
Los Angeles-based Tarrant Apparel Group, another major name in the denim market, continues to expand its position in Mexico and can now boast vertical integration since the opening of its own denim mill in Tlaxcana, Mexico—where president Fox made a recent visit.
Tarrant is also expected to occupy by the end of the year a 1.7 million square-foot combined weaving mill, cutting, finishing, and laundry facility in Puebla, and has recently extended its purchase option of the facility from Tex Tarnsas Textile S.A. de C.V. The facility is scheduled to reach full capacity within two years, and is expected to have a capacity to produce 14 million garments annually.
“The quality of denim produced today in Mexico using the latest state-of-the-art spinning and weaving technologies is as good as almost anywhere on the globe,” said Bruce Berton, director of International Business at Santa Monica, Calif.-based accounting and consulting firm Stonefield Josephson.
“More business is going to Mexico due to proximity, quick-turn, and availability of high quality textiles including denim. The textile and apparel centers of Torreon - Laguna, Tehuacan, Puebla, Gomez Palacio, Vera Cruz, Guanajuato, Queretaro, San Juan Del Rio, and Agua Calientes will become familiar names” to denim manufacturers, he said.
John R. Calvert is president of the business and management consultant firm The Network Group, and also heads a production and sourcing company, The Network Apparel Group that owns and operates its own production facilities in Northwestern Mexico. Calvert can be reached at (310) 629-0836 or by e-mail at jcalvert@mediaone.net.
