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Triad

Hanesbrands shrinks to fit 

It comes as no surprise that Winston-Salem felt pride when Chicago-based Sara Lee Corp. spun off Hanesbrands Inc. in September 2006 and set up its headquarters there. For one, it returned the company to its roots. What became Hanes Corp. was founded in Winston-Salem in 1901. Sara Lee predecessor Consolidated Foods Corp. bought Hanes in an unfriendly takeover in 1979. But Sara Lee decided in 2005 to separate its apparel division — which also includes such labels as Playtex, Champion, L’eggs and Wonderbra — from its food, beverage and household products.

The process took 18 months but couldn’t come soon enough for local leaders. Gayle Anderson, CEO of the Winston-Salem Chamber of Commerce, was thrilled the city had become home to a $4.5 billion company. “Any time you have the headquarters of a company in your community, the decision about how much to participate from a financial standpoint, as well as from a standpoint of people being involved in leadership positions, is made locally, so it’s to your advantage,” she said at the time. Also enthusiastic was the Winston-Salem Journal. Despite citing competition from Asia and elsewhere, it predicted: “Hanesbrands should at least be able to retain its 4,900 job slots in Forsyth County.”

It hasn’t worked out that way. Six months after its debut, the company started cutting local jobs. By the end of this year, when its 850,000-square-foot Winston-Salem hosiery mill closes, Forsyth County employment will be down to 2,500. It will have only one Tar Heel factory left — a sock plant in Mount Airy. Sales dropped 10%, at least in part because of the recession, to $2.9 billion in the first nine months of 2009.

But Twin City leaders still say they feel good about the company. “It’s exactly what we’ve experienced with other manufacturers,” Anderson says. “We’ve been through this enough that we don’t feel it reflects badly on us at all. It’s the way of the world.” Some production has been outsourced to Asia and other low-wage countries, she says, just as it moved in the U.S. from the Northeast to the South in the late 19th and early 20th centuries.

The presence of Hanesbrands headquarters is still a big benefit, says Bob Leak, president of Winston-Salem Business Inc., which recruits companies. “We can show corporate America that this is a viable and good place. It validates, internally as much as anything, that a community has the capability to handle a project of that scope.”

400 to quit cigarettes

Blaming declining cigarette sales, Reynolds American Inc. offered severance packages to 1,800 production workers in its hometown, Winston-Salem, and nearby Tobaccoville. Within a week, about 400 accepted. The departures started in January and will run through early next year. About 75% will be completed by September. The company took a $47 million charge in the fourth quarter to pay for the down-sizing but says it will save $17 million in 2010 and $30 million next year. It has no plans for involuntary layoffs. Reynolds had more than 15,500 full-time workers in the region in 1983. After the buyouts are completed, that number will shrink to about 2,630.

 

WINSTON-SALEM — Round Rock, Texas-based Dell will keep its plant open through April because of increased sales of the desktop computers it assembles here. Dell had planned to close the factory, which employs about 400, in January to focus on more popular laptops.

EDENMohawk Industries laid off 140 employees at its Karastan carpet mill, leaving about 130 on the job. The Calhoun, Ga.-based rug maker blamed poor sales.

STONEVILLESANS Technical Fibers plans to add 25 workers to its local plant by the third quarter, increasing employment to 125. The Gastonia-based company makes synthetic filament and yarn used in automobiles and military gear.

GREENSBOROHonda Aircraft started building a factory near its headquarters at Piedmont Triad International Airport. The company, part of Tokyo-based Honda Motor, will add about 150 employees when production begins early next year, boosting the total to 600.

WINSTON-SALEM — The Forsyth County Tourism Development Authority hired Richard Geiger, former tourism chief in Buffalo, N.Y., as CEO of Visit Winston-Salem, which promotes tourism in the Twin City. He starts work this month.

HIGH POINTThomas Built Buses made Kelley Platt its president. John O’Leary, who had been president since 2002, moved into an undisclosed role at parent Daimler Trucks North America, which is based in Portland, Ore. Platt was general manager of business excellence for the parent company.

WINSTON-SALEM — CEO Kelly King, 61, succeeded John Allison as chairman of BB&T. Last year, he took over for Allison as CEO. Allison remains on the board.

WINSTON-SALEMTargacept struck a licensing deal with London-based drug maker AstraZeneca for a depression treatment. The agreement could pay Targacept $1.2 billion and help it stay independent (Regional Report, December).