Obama’s fashion factory in Illinois may close
The 1,000 workers who make Barack Obama’s suits are worried about their jobs again.
The overseas firm that controls men’s apparel maker HMX — whose labels include Hart Schaffner Marx and Hickey Freeman, famously favored by the president — is pushing for heavy cost cuts, sparking worries that one of its key US factories might eventually be shuttered, sources told The Post.
India-based textile giant SKNL — which last August led a group of investors in scooping up the company formerly known as Hartmarx out of bankruptcy for $128.4 million — has been so aggressive about slashing costs and moving production overseas that union workers in Des Plaines, Ill., right in Obama’s backyard, are afraid the plant will be closed.
“The writing is on the wall . . . we are next to go,” an employee at the factory wrote in a recent letter to the CEO of Emerisque, a British-based private-equity firm that took a minority stake in HMX last year.
The anonymous letter, obtained by The Post, noted that SKNL told its investors in February that it aims to slash HMX’s costs by a whopping 15 percent over the next three years — cuts that could push the manufacturing of the suits overseas.
That’s despite big promises made by HMX’s new owners last year that the company would steadfastly safeguard its “Made in the USA” label.
The factory was churning out specially ordered suits for President Obama and other high-profile customers as recently as last year, according to one source close to the company. Now, HMX is scrambling to operate more efficiently.
Sources said the cost of producing a suit in Des Plaines had soared above $150 before the company’s bankruptcy. Overseas, a similar suit, which sells at Saks, Dillard’s and Nordstrom for about $550, can be made and delivered to the US market for half that cost.
HMX CEO Doug Williams, in an e-mail yesterday, played down the employee letter and the effect of the deep cost cuts, saying he has “absolutely not” been pressured by SKNL to close the Des Plaines facility.
The cuts would further hurt an area where the unemployment rate last month soared to 11.3 percent.
“SKNL is in full support of management’s strategy and sees our factories as a competitive advantage to our domestic market,” Williams said. He added that the Des Plaines factory, along with the company’s Hickey Freeman factory in Rochester, NY, are “running at full capacity to meet customer orders.”
Nevertheless, a source familiar with the situation said SKNL has lately locked horns over cost cutting with Emerisque, which had been outspoken about protecting US workers at the time of the buyout.
Emerisque is “concerned about deviation from the agreed-upon strategy,” according to a person close to the situation. “That includes concern over elements of the manufacturing strategy, as well as the ‘Made in the USA’ commitment.”
An HMX board meeting is scheduled today, with top brass from Emerisque and SKNL slated to attend, sources said. It wasn’t clear whether cost cutting would be on the agenda.
Emerisque officials declined to comment, and SKNL officials couldn’t be reached for comment.