American Apparel Launches Denim Line, Fears Bankruptcy

American Apparel is known for its basic clothing style and is finally revealing the long-rumored debut of their jeans collection. Owner of American Apparel, Don Charney, said in a press release “Jeans are an iconic, essential part of the modern wardrobe, just like the t-shirt.” It has been rumoured the first two styles for women will be high-waisted with a shorts version for the warmer months. They might retail for $80 in the U.S. so it will be a few more dollars on our side of the border.

The male fans won’t be left completely out of the picture as the company plans to roll out men’s heavy weight denim for back-to-school. Whether the company can stay in business long enough for school to start is the lingering question. The company reported a net loss of $86.3 million and a looming deadline of April 30th to pay back money could force the company into Chapter 11. Lawsuits have dragged the company’s reputation through the mud, and we have to wonder if the company can stay competitive in a market place where consumers are still shy to splurge on things like clothing.

The reason the brand is failing is as basic as the clothing they sell. Dov Charney was a man in the t-shirt business since 1989, and in the early 2000’s he took notice of the emerging trend, and by 2005, retail stores were popping up quickly. There was a growing audience for the laid-back ‘hispter’ image the store would become associated with. Even we have to admit to popping into their Yonge Street location for a solid coloured hoodie on a few occasions. The fabrics they use are soft, some shirts are seamless, and the basic-ness of the clothing itself can make the outfit you’re wearing. American Apparel was promoted as being ethically friendly to their employees and factory workers, and the clothing is made in the United States of America? Founded by a guy from Montreal, Canada? How could you not justify that price tag for an extra t-shirt to go with the new hoodie?

As the trend of the “basics girl”, that was the bread and butter of the business to American Apparel, started to die down, scandals would also plague the company’s further growth. Several sexual harassment and assault lawsuits, including one that is still pending in court. A lawsuit that was settled over the use of Woody Allen’s image that cost the company a cool $5 million. Immigration issues were a real problem for the retailer because it tarnished the “all-American made” image the brand once touted so proudly.

There are currently 39 American Apparel stores throughout Canada, with 6 of those retail stores being in Toronto.

Watch the video below, from today’s American Morning from CNN.com to see an interview of American Apparel owner Dov Charney discuss his recent legal woes.

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