World's largest carpet maker sets up plant in Nantong

Shaw Industries, the world's largest carpet maker and a wholly-owned subsidiary of Warren Buffett's multinational conglomerate holding company Berkshire Hathaway, opened a carpet tile plant on Thursday in Nantong, a port city in Jiangsu province.

The manufacturing facility, with an investment of $45 million, represents part of Shaw's intensifying efforts in China, a move endorsed by the US investor and billionaire Buffett.

Shaw Industries chairman and CEO Vance Bell said the establishment of the Nantong plant will help the company better serve fast-growing demand for flooring solutions in Asia, in particularly in China.

"Two thirds of the world's carpet tile is sold outside of North America – the majority in Asia," he said. "Sales in China, in particular, have grown 20 percent annually, making it the world's third-largest carpet-tile-purchasing country."

The Nantong plant will be Shaw's only manufacturing facility outside the United States. It will make recyclable carpets for Asia. Previously Shaw's carpet tile products had to be shipped from the US to serve local customers.

"For an American company that produces a product that people around the world will find advantageous to use, it would be absolutely folly not to have a major manufacturing operation in China turning out that product," said Buffett in a video speech at the opening of the Nantong factory. "I hope this is just the beginning of a much larger operation over time."

Chinese consumers are less inclined to buy carpets for residential use, compared to US consumers. However, Buffett said Chinese people "are going to want a lot of carpet tile and they're going to find Shaw is a good place to purchase it".

Shaw is now focusing on providing carpet tile to office buildings in China. The expansion of multinational companies in China and the rise of local companies, especially Internet companies, are creating fast-growing demand for carpet tile to provide a comfortable work environment for their employees.

With annual sales of $4 billion, Shaw Industries serves both the residential and commercial markets with flooring products such as carpet, rugs and hardwood. It is headquartered in Dalton, Georgia, which is known as the "Carpet Capital of the World".

Jeff Galloway, vice-president of Shaw Industries, Asia Pacific, said it's a natural decision for Shaw to choose Nantong, which is home to China's modern textile industry, to build a carpet tile plant. "Nantong's woven textile heritage mirrors the communities in which we've manufactured flooring in the southeastern US for more than half a century," said Galloway.

In addition to the Nantong plant, Shaw Industries has also established showrooms or sales offices in Shanghai, Beijing, Chengdu, Guangzhou and Hong Kong.