Springs downsizes greige, expands terry capacity

FORT MILL, SC — Gearing up to expand its towel business and grab market share after the demise of rival Pillowtex Corp., and at the same time improve its deliveries, Springs Industries said it's expanding its U.S. towel manufacturing capacity at two terry plants in Griffin and Hartwell, GA.

But coping with excess capacity in its sheet weaving operation, the major mill also said it's permanently closing two weaving facilities, the Springfield plant in Laurel Hill, NC, and the Leroy Plant in Fort Lawn, SC, putting about 320 workers out of a job. The move accelerates a growing trend at Springs of sourcing greige goods for bedding products off-shore, most notably for opening to mid price-point blends.

In a surprising twist in an industry that's seen a substantial portion of its towel business move offshore in search of lower costs, Springs said it's building domestic capacity "to fully serve its customers and meet growing demand for its towels," notably after the collapse of Pillowtex. Ted Matthews, Springs vp of communications, said the move will generate "a significant increase in our capacity and our ability to service the business," but declined to be more specific.

"The investment will add jobs and make our towel operations more competitive and more flexible so we can respond faster to customer demand," said Dean Riggs, executive vp of Springs and president of the Bath Fashions business unit. Riggs said the investments "are in addition to millions of dollars the company has been spending to streamline processes and covert to a uniform computer system for all operations." The Hartwell and Griffin plants about to be expanded recently completed a switch to the new system, he added.

But continuing to down-size its U.S. weaving capacity, Springs said it will close the two greige plants on Dec. 1. "There is lower demand from our business for the type of fabrics made at these plants," said Henry Surratt, vp of bedding fabrics manufacturing. Additionally, the company said, "equipment at the two facilities in not as efficient compared to other Springs plants."

Springs also recently shut down the Lancaster Plant in Lancaster. SC, and the White Plant in Fort Mill, SC. "We knew when we closed those two plants we would still have excess capacity, but we didn't know how much until recently when we reviewed business plans for the coming year," said Matthews.

The shutdown of the four weaving plants, he said, doesn't necessarily signal a decline in Springs's bedding business. "Our overall bedding business is stable and growing, but the mix of the business is shifting," he said."

With the impending shutdown of two more weaving plants, "the remaining plants will be running at full capacity and on a full working schedule," said Matthews, following sporadic shutdowns throughout the year.

Matthews declined to state by how much the shutdowns will reduce U.S. capacity, or to state how much of the company's greige production has moved overseas.