El Salvador: Textile Industry Lose Competitiveness

The Salvadoran union has stated that excessive bureaucracy and high production costs are the main factors that could be encouraging some textile mills to reduce operations in the country.

Friday, March 24, 2017

José Antonio Escobar, president of the Chamber of the Textile Industry, Clothing and Free Zones of El Salvador (Camtex) told Elsalvador.com that one of the companies that has shut down part of its operations, to transfer them to another country, is Fruit of the Loom. Escobar said   "...'In the plant owned by Fruit of the Loom in the industrial park American Park, where a thousand people work, the company will make a reduction of about 850 positions'."

See also: "Textiles and Supplies Market in Central America"

"... According to Escobar there are two more maquilas with a determined vision to move their operations from El Salvador to another country in the region. One of those looking to migrate, he said, generates 1,800 jobs and produces sportswear brands and is already looking for new horizons in Honduras or Nicaragua.  There is also another specializing in the manufacture of underwear for ladies and gentlemen, with one thousand employees, which is considering closing its operations."

"... In the view of the representative of Camtex, the exodus of investment in the country is related to the loss of competitiveness. In the maquila sector, for example, sending a container to Puerto Cortes in Honduras costs between $800 and $1,000 for the freight of a commodity that will take six days to reach its destination."

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More on this topic

Textile sector: Production Becomes More Expensive in El Salvador

December 2017

Salvadoran textile companies state that the costs of labor, security and delivery times have made the sector's operations more expensive.

The recent increase in the minimum wage is one of the factors that has had a direct impact on the cost structure of Salvadoran textile companies. Added to this are logistical difficulties in customs offices, which have caused companies from neighboring countries to obtain contracts that were originally planned for El Salvador.

Honduras: Textile Company "Jersey" Starts Operations

March 2010

Jersey, part of Fruit of the Loom group, will start operating this week.

It is located in the north of the country, and will generate 750 jobs.

“Jersey executives decided to open this facility in response to increased demand from the United States”, reported Laprensa.hn.

Limited Credit for the Salvadoran Textile Industry

April 2009

Faced with limited access to credit, the textile industry is looking to find financing abroad.

Jose Escobar, leader of the Salvadoran Chamber of the Textile Industry (CAMTEX), noted that the problem continues to be the risk analysis that is being used to evaluate them.

Textile Manufacturer to Suspend 3,000 Workers in El Salvador

March 2009

The Fruit of the Loom textile company halted operations at one of its 7 plants, temporarily suspending 25% of its personnel.

The chairman of the Salvadoran Chamber of Textiles and Apparel reported to La Prensa Grafica that the decline in operations is due to "Fruit of the Loom clients being overstocked with product and adjusting inventories.”

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