updated 1/20/2006 5:26:01 PM ET 2006-01-20T22:26:01

Textile manufacturer Russell Corp. will eliminate 2,300 jobs — about 15 percent of its worldwide work force — and freeze its pension plan.

The job cuts, most of which will come in the U.S., are part of a bid by Russell to reduce costs so it can continue selling men’s fleece products to Wal-Mart Stores Inc., Russell spokeswoman Nancy Young said Friday.

The company previously said it lost a contract to sell fleece products for boys to Wal-Mart, the world’s largest retailer. The loss left Russell with too much manufacturing capacity, making cutbacks necessary, Young said.

In a statement late Thursday, Russell chairman and chief executive Jack Ward said the cuts were meant to help Russell remain competitive globally.

“These changes will result in our having fewer, larger facilities,” Ward said. “We must move quickly to achieve lower costs, both in our operations and our support areas.”

Russell said the company will eliminate about 2,300 jobs from its global work force of 15,000. About 1,700 of the jobs cuts will be in the United States, with about 1,250 in Alabama.

Russell said it also would reduce an unspecified number of workers in Chantilly, Va., and cut about 90 office jobs in its former headquarters at Alexander City, Ala. and in Atlanta, where the company has been based since its last restructuring.

About 1,200 of the U.S. jobs will eventually be replaced by hiring in Honduras and Mexico, the company said.

Russell said it also will freeze its pension plan on April 1. The company said it would “significantly improve” its 401(k) plan for employees.

Russell also plans to close a sewing plant that employs about 600 people in Jimenez, Mexico, and said it would move production of Huffy Sports backboards from Sussex, Wisc., to China, eliminating 85 U.S. jobs.

After the cuts, Russell will have 2,000 workers in Alexander City, where it once employed 7,000 people.

Russell said the restructuring would cost as much as $52 million after taxes, with a yearly pretax savings of as much as $40 million.

© 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


Discussion comments


Most active discussions

  1. votes comments
  2. votes comments
  3. votes comments
  4. votes comments

Data: Latest rates in the US

Home equity rates View rates in your area
Home equity type Today +/- Chart
$30K HELOC FICO 3.79%
$30K home equity loan FICO 4.99%
$75K home equity loan FICO 4.69%
Credit card rates View more rates
Card type Today +/- Last Week
Low Interest Cards 13.83%
Cash Back Cards 17.80%
Rewards Cards 17.18%
Source: Bankrate.com