Levi’s, Gap Denim Supplier Downsizing as Business Dries Up
Weak demand, fluctuating cotton prices and labor shortages are driving Nien Hsing Textile Co. to downsize in its home country.
The Taipei Times reported that the Taiwanese denim fabric and jeans manufacturer announced it will close its factory in Miaoli County’s Houlong Township as soon as it finishes outstanding orders. The closure will lead to 600-700 layoffs.
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Levi’s, Gap, Old Navy, Madewell, American Eagle, The Children’s Place and Macy’s are listed as clients on the mill’s website.
The facility, which houses yarn spinning, dyeing, weaving and finishing departments, is operating at about 76.4 percent of its capacity of 1.4 million yards a month, producing an average of 1.07 million yards of denim fabric a month, Taipei Times reported.
In a press conference, the news outlet reported that Nien Hsing president Andy Tsai said the company will follow local labor rules in “reporting its layoff plan to the authorities and providing the affected workers compensation.”
Consolidated net revenue from January through November 2022 to the same timeframe this year declined about 30 percent. Tsai said the Houlong factory has a pre-tax loss of 220 million NT dollars ($6.98 million) in the first 10 months of this year. He added that closing the factory will allow Nien Hsing to improve its operations and “shore up shareholder equity.”
The Houlong factory is the company’s first mill, opened in 1988. Nien Hsing has widened its global footprint with facilities in Mexico, Vietnam and Lesotho.
In Lesotho, the company offers integrated garment production through its mill where daily capacity maxes out at 40,000 yards of denim textile and its factory cranks out 23,000 pieces per day. In Mexico, Nien Hsing’s daily output is capped at 66,667 yards of denim. The company’s factory in Vietnam produces up to 20,000 pieces every day.
Nien Hsing presented its Spring/Summer 2025 collection at Kingpins Amsterdam in October. The collection spans Y2K-inspired metallic coatings, aged washes, cracked surfaces and fabrics with unique textures created by laser.
