Mohawk closing Rome plant; 228 hit

Mohawk closing Rome plant; 228 hit

October 29th, 2011 by Ellis Smith in Business Around the Region

Mohawk Haircut

Mohawk Industries has recently shut down or announced plans to close four plants in Northwest Georgia.

• Rome, 227 employees

• Cartersville, 229 jobs

• Chatsworth, 360 jobs

• Calhoun, 393 jobs

Mohawk Industries plans to permanently shut down its Huffaker spun yarn plant in Rome, Ga. and lay off 228 employees, the company announced Friday.

The shutdown, expected to start in earnest on Dec. 27, will take place in phases over the next two months, Mohawk said.

Mohawk plans to offer other jobs to the affected employees within the company, a typical practice within the shrinking carpet industry.

The carpet industry has suffered a rash of shutdown announcements in the second half of the year.

Early optimism about the economy after carpetmakers posted modest gains in the first half of 2011 led quickly to fears of a second recession as those gains were erased by stagnant joblessness at home, and a housing market diluted by foreclosures.

Spun Yarn's Demise

The Huffaker plant produces a spun yarn product that industry officials say is no longer demanded by consumers, who have increasingly embraced newer filament yarn-based products.

The old spinning process is also more labor intensive, a key source of costs for manufacturers after petroleum pellets, said Kemp Harr, publisher of Floor Focus magazine.

"This is part of a long-term plan to phase out spun yarn," Harr said. "Everything has gone to filament, and it costs half as much on labor."

A number of other spun yarn plants have also been shuttered during the course of the recession, by Mohawk and its competitors, as the companies work to slim down their cost structure in light of the flat housing market.

Wood Gains vs. Carpets

The market has also trended toward hard surfaces of late, with wood and vinyl flooring becoming more popular in some segments compared to traditional carpet.

"Wall-to-wall carpet as a share of flooring has gone from 51 percent of the market in 2005 to what we project will be 42 percent in 2015," Harr added.

Mohawk's latest closure comes on the heels of shutdowns in Calhoun, Cartersville and Chatsworth, for a combined total of about 1,210 jobs for the Calhoun, Ga.-based carpetmaker. At the same time, Mohawk has invested in filament facilities in South Carolina and Georgia, said David Steele, Mohawk's senior vice president of operations.

"Mohawk is committed to offering our customers exceptional quality product innovation and industry-leading service through our dedicated employees," Steele said.