Shoemaker Vans Will Close Plant; 1,000 to Lose Jobs
Beleaguered sneaker maker Vans Inc. said Wednesday that it will close its plant here at the end of July, throwing about 1,000 employees out of work.
Vans, one of the few companies still manufacturing shoes in the United States, linked the long-rumored move to increased competition from lower-cost foreign producers. It also said consumers are clamoring for a style of shoe that Vans must buy from overseas makers because it can’t manufacture them in the United States because of environmental regulations.
However, union representatives contend that the company closed the plant to try to derail ongoing efforts to organize employees.
“You never want to close a plant,” said Walter E. Schoenfeld, Vans president, adding that the company will continue to produce shoes at a newer plant in northern San Diego County. “There were an awful lot of very long board meetings before the decision was made. This is a very unpleasant day for all of us.”
The closure--and a $35-million charge the company will take for it--are the latest in a string of unsettling developments at Vans, the single largest manufacturing employer in Orange.
“We’ve all suspected for weeks that something was going to happen, so we were preparing ourselves for the worst,” said Yvonne Ortiz, 51, a Vans employee since 1968. “I can’t even begin to tell you what I feel like. It’s like someone has taken away my life.”
The closing will be especially tough on families who worked together at Vans, a common situation because the company encouraged employees to advertise openings to brothers, sisters and children.
The company said it will provide severance pay and job fairs and will give employees time off with pay to look for new jobs. An as yet unidentified number of employees might find jobs at Vans’ distribution center in City of Industry or at the other manufacturing plant in Vista. The company also said Wednesday that another local company hinted it might be able to hire as many as 200 employees.
Vans, founded in 1966 as Van Doren Rubber Co., has endured seismic shifts in its fortunes. Sales soared when teen-agers saw the company’s black-and-white-checkered shoes in the 1982 hit movie “Fast Times at Ridgemont High.”
The company geared up for more production, but the fad passed and the sneaker maker quickly fell into bankruptcy. Private investors pulled the company out of bankruptcy and took over in 1988, and earnings rose. But the company soon had more woes.
Since 1993, Immigration and Naturalization Service officials have deported hundreds of Vans workers who lacked proper identification. In January, Vans laid off about 450 employees, blaming high inventory levels. It also cut shoe inventories in the early spring by closing its Orange and Vista plants for several weeks.
In addition, the shoe manufacturer was caught up in an increasingly hostile union representation bid by the Teamsters.
“I imagine they’ll now use this plant closing to threaten workers in Vista,” said Raul Lopez, head of Teamsters Union Local 396 in Anaheim. “They’re going to try to scare the pants off of those people about the union.”
Vans executives said the closure was not linked to the union drive.
“This was strictly a business decision,” said Vans Vice President Craig E. Gosselin. “It was based upon the fact that we have too much manufacturing capacity in the U.S.”
The closure comes at a time when Vans’ sales are increasing. Revenue grew 10% to $63.5 million during the nine months ended Feb. 25. Earnings more than tripled to $1.8 million during the period.
But the increases were fueled by consumers clamoring for its shoes produced overseas, the company said.
Vans shares closed up 31.25 cents at $4.5625 in Nasdaq trading Wednesday.
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