Ponzone, Italy -- Armed with tweezers, Daniela Rigolon plucked minuscule stray wool fibers on Tuesday from some black-and-white plaid fabric destined to become a Lanvin coat. Lanvin is among the labels—along with Chanel, Armani, Dolce & Gabbana, Akris, Kiton and Balenciaga—that turn to Ms. Rigolon's employer, Lanificio Egidio Ferla SpA, for fabrics that define luxury. Italian fabrics will be a central part of the collections at Milan fashion week, which started Wednesday, and at Paris fashion week, which will follow. Italy's Luxury Textile Mills A look at the companies that create fabrics for the runways. View Slideshow Alessandro Scotti for the Wall Street Journal A weaving machine for yarn. Many top designers rely on these high-end textiles to create their most luxurious or unusual looks, such as Etro's brilliant jewel-like colors, some of Chanel's famous tweeds, and the color-morphing looks shown at Prada several seasons ago. More recently, at New York's fashion week, where sumptuous textiles took center stage, Italian textile makers supplied fabric for Michael Kors, Jason Wu, Nanette Lepore and Carolina Herrera, among countless others. Ms. Lepore, who showcased a unique tapestry print in New York, says she uses almost entirely Italian fabrics. "We need these Italian factories," she says. Designers turn to factories here in the Biella region of northern Italy for the highest-quality suiting textiles—cashmere, silk, linen, and wools including Loro Piana's vicuña and Ferla's baby alpaca. The fabric is then shipped to factories around the world for manufacturing. Other regions of Italy have their own textile specialties; Como is known for shirt fabrics and Prato for fancy womenswear fabrics. But all are united by Italy's reputation for fabric quality and innovation. "We are not afraid of making special qualities, special colors," says Paolo Ferla, grandson of the firm's founder. Associated Press Many designers at New York fashion week experimented with Italian fabrics to create textured looks such as Nanette Lepore's tapestry print tunic, above, and Carolina Herrera's pantsuit, below. Associated Press Yet a drive through the alpine hills here reveals a startling amount of abandoned industrial real estate—dozens upon dozens of crumbling textile factories built along the streams that once powered the mills. The vacant buildings are the result of many years of low-priced competition from other countries, mainly China. Ferla hopes to produce only 150,000 meters (about 164,000 yards) of fabric this year, down from 250,000 meters in the 1980s. Indeed, sales in the Italian textile industry have slumped at least 30% since 2008. "Horrible. Horrible, horrible year," Mr. Ferla says from his sprawling factory, which has ample unused space. Yet in keeping with Italian tradition, he hasn't laid off any of his firm's 35 employees, many of whom have extensive ties to the company. (Ms. Rigolon's two aunts work there, too.) Outside Italy, there are some signs that the fashion industry is picking up steam. U.S. apparel sales declined 5.1% in 2009, but there were glimmers of improvement in womenswear in the fourth quarter, according to NPD Group research. And many retailers have been posting improved results in recent months. Yet consumers have been demanding cheaper clothes, and one way retailers have achieved these improvements is by pressuring apparel manufacturers to lower prices by more than 20% for each of the past two seasons. Many have done so by moving more production to China, Sri Lanka, Thailand and other low-labor-cost regions of the world. Like other textile makers in the region, Mr. Ferla can't devalue the strong euro, which makes Europe's exports expensive, or compete with China's relatively cheap labor. But he can offer small quantities, special colors, new weaves and patterns, and even new fibers. A decade ago, Mr. Ferla innovated the use of baby alpaca, which is softer than cashmere. He comes out each season with new variations on tweed-like fabrics thrust through with various colors of thread. Italian textile makers have also created techniques such as extra twist in the thread that offers more stretch, new methods of combing bouclé to make it soft, or spinning tiny threads together to make extraordinarily soft wools. Yet factories in China are proving as adept at copying fabrics as films and handbags, which is pressuring the Italians. While worried, Mr. Ferla is relying on his quality-focused business strategy. "It's never more important for us to maintain the quality and the innovation of production," he says. Then he quotes Dostoevsky: "Beauty will save the world." More Fashion Coverage Vogue App Turns Ads Into Shopping Links What Milan Fashion Did for Anna Wintour Heard on the Runway Kurt Wilberding/The Wall Street Journal In his latest collection, designer Jason Wu created a paint-splattered effect on materials including Italian wool. "If we lose the Italian mills, we lose the creativity needed for fashion," says Sal Giardina, an adjunct professor of textiles at New York's Fashion Institute of Technology. "Fabrics are the common denominator

— Italian mills  

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