The Pro Tejer Foundation made a report on the current situation textile industrywhere they described a huge concern When making a comparison between the May-June 2023 and 2024 semesters.
The institution claims to be going through a ”alarming situation”which include the layoffs of more than 5 thousand workers and the suspension of another 10 thousand. They also add that ”after the record investments of the last 3 years (which exceeded USD 1.4 billion) Today 6 out of 10 machines are stopped”.
In the report data, they detailed that Almost 80% of companies recorded average declines of 40% in sales volume and production year-on-year, as well as that the 76% reduced the use of installed capacityrepresenting a drop of 29%.
On the other hand, they revealed the percentage of companies that are affected by this collapse of activity in the sector. 45% had to reduce its staff in June, compared to December 2023, averaging a drop of 16%. As for the investments, 84% of companies will choose not to make them.
Finally, 40% of companies have problems meeting current expensesand a worrying 81% think that, with the current exchange rate, it is very difficult to gain markets abroad.
Another fact provided by the foundation is that 90% of the companies that had to reduce their production, They attribute the problem to the change in the purchasing power of the population. Other possible causes mentioned were macroeconomic expectations and changes in the business climate, changes in sectoral policies, the entry of imported products and the devaluation of December 2023.
The textile crisis is growing: Topper Tucumán has stopped production and in La Rioja they are talking about times of “pandemic”
The government’s elimination of customs controls on the labelling of textile and footwear products entering the country has deepened the atmosphere of uncertainty in the sector, which is experiencing a sharp drop in sales.
One of those affected was the well-known company Topper, which had to stop its production due to excess stock: “Consumption has fallen and the Government’s decision will further deepen the crisis of local production,” held to Ambit a businessman from Tucumán in the footwear industry which had to lay off 90 employees, out of the 120 it had until April.
Alejandro Munoz The company has its shoe factory and warehouse in Aguilares, 90 kilometres south of the capital of Tucumán, because Topper, formerly Alpargatas, is located there. Due to its specialisation, it provides services for the Argentine brand, but the drop in sales has also reduced its workload.
“I went bankrupt under the government of former President Mauricio Macri for the same reason, because there were no sales. But I got up with a lot of effort and the same thing happened again. If the drop in sales is added to the ease of imports, the result will be the destruction of the national industry,” Muñoz reflected.
With the staff that he retains, he added, he is working on designing his own brand to sell directly to the public. “We are preparing everything because by not having intermediaries, I will have competitive prices but everything will depend on the evolution of the country’s economy,” hill.
They compare the current situation with the pandemic
Another case is that of La Rioja, whose industrial park operates at 30%: “We are in a survival stage, as in the productive levels of the pandemic, at 30% or 40%, due to the fall in economic activity”he declared Juan Serranovice president of the Union of Riojan Industries (UNIR).
“It has not worsened, but it has not improved either. The negative trend continues over time and production is minimal, since it is more expensive to keep the plant stopped.”he said. He added that the most affected companies are those that supply the country’s domestic market.
It had 140 employees in the park in La Rioja and 124 in a building in the capital of Catamarca. The workers have not yet received compensation, they are owed salaries and their reintegration into the labour market is uncertain.
Source: Ambito
