PRINGLE, the luxury knitwear firm, is to close its manufacturing plant in the Scottish Borders after almost 200 years, with the loss of 80 jobs.
The woollen jumpers favoured by generations of golfers, as well as celebrities such as Madonna and Scarlett Johannson, are now expected to be made in Italy.
The firm's management announced a review yesterday that is expected to lead to the closure of the manufacturing plant in Hawick, which employs 110 staff, while retaining 30 jobs to staff the head office, finance and customer service departments.
The job losses come after Pringle reported a loss of 9 million last year and its owners, SC Fang & Sons, embarked on a global restructuring. The Pringle of Scotland collection is manufactured in Hawick as well as at plants in northern Italy, where costs are reportedly 30 per cent lower than in Scotland. Following the review, all manufacturing will leave Scotland, with production expected to be transferred to Italy.
While the jumpers will no longer bear the mark "made in Scotland", they will continue to be branded as Pringle of Scotland. Yesterday, a spokesman for Pringle denied the head office was being kept in Scotland to continue the successful brand name.
He said: "We will maintain an office with crucial roles, the head office, customer services and finance, and if the manufacturing operation closes we may still place orders with other Scottish companies."
It is understood that part of reason for stopping manufacturing in Hawick is the high cost of running the plant. Since buying the company for 6 million in 2000, SC Fang has invested up to 45 million rebranding the company to the point where traditional knitwear accounts for just 15 per cent of sales.
Yesterday, Douglas Fang said: "We have to consider ways to improve the performance of the business, and closure of the manufacturing operation at the plant is, regrettably, something we must consider.
"Any decision to close the operation is not one we would take lightly, but due to changing customer demands and the competitiveness of the industry, we have to consider this possibility."
In Italy, where there is no minimum wage, the average hourly pay is 6.72, compared with 9.36 in Britain. Pringle is also able to make savings in transport costs and economy of scale on account of the large textile industry in northern Italy.
The announcement comes as a blow to the Borders, where the company was founded in 1815. Yesterday, Hawick provost Zandra Elliot, who worked for several years at Pringle, said there was "great sadness" in the town.
She added: "My only shock is that the factory only employs 110 people; there used to be more than 1,000 in there.
"Generations of families have worked at Pringle, and it is so sad that 80 families will be without a wage packet."
Roxburgh and Berwickshire MSP John Lamont described the move as "devastating".
He said: "This announcement is bad news for scores of Pringle employees, their families, the local textile industry and the wider community."
The MSP added: "My most immediate concern is for the scores of workers who are in danger of losing their jobs."
PRINGLE was established by Robert Pringle in 1815, producing hosiery and underwear.
In 1870, the company began to produce elegant jumpers and in 1934 it appointed its first full-time designer in the knitwear industry, Otto Weiz, who came up with the twinset and signature argyle pattern which became popular with celebrities such as Bridget Bardot. At its height the company employed more than 1,000 people at its plant.
In 1967, Pringle of Scotland was acquired by Joseph Dawson (Holdings) Ltd, and pursued an international expansion programme in the early 1990s. However it was forced to cut back on many stores and franchisees because of an overly rapid expansion strategy.
Throughout the 1980s and 1990s leisure and sportswear played a key role in the Pringle of Scotland brand with top British golfers, including Nick Faldo and Colin Montgomerie, sponsored by the group.
In 2000 the brand was bought by Hong Kong-based SC Fang & Sons Company, which moved the company in a new direction, away from knitwear and towards luxury tailoring for a younger market.
Clare Waight Keller, the London fashion designer credited with the move, said: "I wanted to move away from the sportswear associations and all that rampant Scottishness."
In September, Mary Adair Macaire, former marketing director for Chanel, will take over as chief executive.