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Burghard Schneider, chief executive of the 210-year-old Swiss textile manufacturer Cilander, sent a letter in late January that rocked its high-fashion clients.
“The economic conditions for profitable production in Switzerland have steadily deteriorated in recent years,” Schneider wrote. “All of this means that Cilander is repeatedly slipping into the red.”
The company expects to shutter its operations by August, he announced, “as there are no signs of this situation easing”. Cilander’s roster of clients, which include fashion brands such as Akris, Chanel, Saint Laurent and Hugo Boss as well as automotive and industrial-textile users, have until 15 February to place their final fabric orders. Reactions spanned from shudders to grief.
“It’s sad for Switzerland,” says Albert Kriemler, creative director of the Swiss label Akris, which is perennially one of the top selling women’s ready-to-wear brands at US luxury department stores. Akris is a favourite of business executives who require clothing whose materials — double-face cottons and wools, wool-silk jacquard — have the heft and excellence to serve as armour in the boardroom.
“I am devastated for the wider macro implications and all that this means,” says Kristen Fanarakis, founder and designer of Senza Tempo, an American label manufactured in Los Angeles that also caters to business executives requiring powerful pieces. Her $525 Maggie tunic was designed around a white cotton Birdseye pique from Cilander. She is so enamoured with the high quality of Swiss cotton that she devotes an entire four-paragraph section on her website to the shirt’s fabric. The fabric, set to meet Swiss+Cotton standards, must have extra-long fibres of at least 35.7 millimetres, her site explains, which makes the fabric 40 per cent stronger than other cottons.
Rather than the beginning of the decline for Swiss cotton milling, Cilander’s fate marks something very near the end. In the decade from 2011 to 2020, exports of Swiss cotton fell by more than half, to fewer than 4,000 from more than 9,000 metric tonnes, according to the International Cotton Advisory Committee of the Swiss Confederation. It’s been in free fall since then, with hundreds of small mills closing, many of them weavers.
Peter Flückiger, an economist and the chief executive of the Swiss Textile Federation, describes what has taken place as a “toxic cocktail” of economic forces. Switzerland’s average hourly labour costs are double those of the European Union. Its exceptionally strong currency makes its exports expensive for Europe and the US. The crisis in Ukraine sent energy prices sky high. During the pandemic, brands stocked up on materials and then sliced purchases in what he describes as a “bullwhip” effect. Swiss textile clients turned to less costly suppliers in Pakistan, Portugal, Turkey and Eastern Europe. Last summer, after Cilander noticed a dramatic drop in orders, Schneider says his team purchased shirts at retail from a European client and had them tested. They discovered the client was using a Turkish competitor.
“The market for high-quality product is no longer there,” says Schneider, who intends to exit the textile industry once he has completed Cilander’s closure this summer.
High standards — at a price
For more than a century, hundreds of Swiss mills — many of them in the Appenzell region centred around Saint Gallen — wove long-fibre Egyptian cotton into fabric, then sent it to factories that dyed, treated, printed and otherwise finished the luxury fabrics using chemical processes that met Swiss ecological and labour standards for clean water and air, and relatively high living standards; some of the most stringent requirements in the world in a nation bent on meeting its pledge to cut carbon production by 50 per cent by 2030 from 1990 levels.
Cilander, whose 190 employees will be out of work by summer’s end, operates at the end of the cotton textile production process. It is known as a finisher, taking woven cotton and adding the final details by printing it or using other chemical treatments such as making it non-iron (without using formaldehyde, which can be absorbed by the wearer’s skin).
“The problem,” says Kriemler, “is that all the twisting and weaving companies in the past 10 years have shut down. So if there are no weavers anymore, how should (Cilander) survive?”
The Swiss textile industry is shifting toward industrial production for automotive and airline fabrics, medical devices and filters, where clients are willing to pay for quality, says Flückiger. This leaves fashion designers and their quality-minded clients out in the cold.
In a broad sense, what has happened in Switzerland in the early 21st century is what happened to US textile manufacturing in the late 20th. A vast industry disappeared after the 1992 North American Free Trade Act, unable to compete with the cheaper labour and more lax environmental and workplace regulations of Mexico.
While some niche producers of US textiles remain — often supported by the military — there aren’t enough of them to support the American fashion industry. This puts American designers at a disadvantage: they must ship fabrics and test them from overseas, leaving them unable to work closely in fabric development in ways that European designers take for granted.
Searching for alternatives
Fabrics are often seen as commodities whose sources can shift with the economic winds. But at high levels of fashion, some fabrics are more than just an input — they are the reason the product and the company can exist.
At family-owned Akris, Kriemler says his father worked in-house to develop several Swiss cotton fabrics that are essential to the label, such as a double-twist cotton voile that is the secret sauce in several Akris trouser designs. He regrets that Akris has been forced to move to Italian and other non-Swiss fabrics for much of its supply chain. But he attributes Akris’s survival to those in-house fabrics.
“These are secrets — I tell you too much,” Kriemler says. “You know how proud I am to still have these best fabrics? It’s why we are one of the last private independent [ready-to-wear] companies that still exist.”
As is so often the case, Cilander’s loss may weigh most heavily on small brands that are focused on excellence, but lack the resources to develop fabrics in-house. Cilander, accustomed to working with bespoke tailors around the world, sells as few as six metres of fabric in an order, Schneider says.
There is a possible door prize. One of Cilander’s luxury shirting lines, called Alumo, has found opportunities among the ultra wealthy and in the Middle East, where oil profits have left fashion clients unfazed by steep prices. The business is relatively tiny: Alumo’s annual revenues are currently around $8 million, says Schneider, who sees a market potential for $12 million. The company is considering moving Alumo’s production to a smaller site in Switzerland and continuing it, though no final decision has yet been made, he says.
Fanarakis, of Senza Tempo, is at a loss for how she will continue her shirting line.
“It took me years to find them,” Fanarakis wrote in an email. “I have no idea how I could replace this or what I’ll replace it with. Anything else — even a nice Italian cotton — will be a trade down.”
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