Shaw, Mohawk announce more closings

Jamie Jones

December 01, 2008 07:43 pm

— Shaw Industries will lay off 170 workers when it closes a carpet fiber facility in Anderson, S.C., next month, while Mohawk Industries will eliminate 79 positions as it shuts down a distribution center in Shannon over the next 60 days.
The closings announced Monday coincide with the National Bureau of Economic Research declaration that the country is in a recession that began in December 2007. The Dow Jones Industrials dropped nearly 700 points on Monday.
The floorcovering industry has been hit hard by the slowing economy, a cooling real estate market and customers trending toward hard surface products such as wood and tile. Calhoun-based Mohawk Industries has laid off more than 1,000 workers in Georgia and South Carolina this year. Dalton-based Shaw Industries has cut several hundred jobs, most recently saying it will eliminate 125 positions at a Calhoun rug plant. The company also announced plans to cut 3 percent of its North Georgia work force this year, which could amount to between 450 and 480. The Dixie Group has also cut its work force significantly this year.
Shaw officials decided to close the Anderson plant due to a decrease in demand and expansions at other fiber facilities. The company, which is the world’s largest carpet manufacturer, in recent months has unveiled plans for expansions at plants in Columbia, S.C., and Andalusia, Ala.
“Shaw acquired the Anderson facility as part of its purchase of the U.S. nylon fibers business of Honeywell International in 2005,” said Hal Long, executive vice president of operations. “Since that time market conditions and a higher cost structure, along with other factors, have meant that this facility could not run at capacity or produce at a cost comparable to our other fiber assets. With the current economy and critical housing market downturn, this facility does not offer a competitive advantage for Shaw vs. other internal options. It is important that we continue to make adjustments to match customer demands and even more important that we invest in those facilities and assets that will provide the best competitive advantage and position in the long term.”
Production at the Anderson site will end sometime near Jan. 29, 2009. Company officials said they hope to place laid off workers at other plants, but noted, “Current market conditions, among other factors, make it difficult to predict how many displaced people may be successfully placed during the coming months.”
Mohawk is “constantly evaluating business strategies to improve customer service while reducing costs,” said John Ames, Mohawk’s vice president of transportation and warehousing. The Shannon site will shutter within 60 days. The company will try to find jobs for the affected employees at other Mohawk distribution centers in Northwest Georgia. Shannon is near Rome.
“Mohawk has set the industry standard in transportation and warehousing,” Ames said. “Much of that has resulted from the exceptional work ethic of our employees. With today’s challenging economic situation, production demands are lower, so maintaining a small warehouse like Shannon with larger, more modern facilities nearby was no longer practical or cost effective.”
Mohawk Industries is the world’s largest floorcovering manufacturer.