Newell Rubbermaid Inc. plans to close its Greenville, Texas, injection molding plant in June, the firm announced Dec. 5.
“Following a careful and thorough review of our business, we have announced to our employees plans to reorganize our U.S. manufacturing facilities to more closely match capacity with consumer demand,” the company said in a news release.
The Greenville plant employs 490 full-time employees and is part of the Rubbermaid Home Products business unit. A spokesman said in a phone interview production will be relocated elsewhere in the U.S., but did not specify where. Other Newell Rubbermaid injection molding plants are located in Cleveland, Tenn.; Winchester, Va.; Winfield, Kan.; Mogadore, Ohio; and Mississauga, Ontario.
“This was a difficult decision to make, but is a necessary step to ensure we compete effectively in an uncertain economic environment while continuing to offer high-quality products made in the USA,” the consumer-products giant explained.
A spokesman said Greenville is an excellent facility and has won the firm's CEO safety award, but after a long look at Newell Rubbermaid's manufacturing footprint the facility was deemed unnecessary.
The molding operation's area is 950,000 square feet. The company will work with the city of Greenville to market the building. The number of injection presses there was not disclosed.
Newell Rubbermaid said it will try to mitigate the impact on employees by providing transition services and supplemental unemployment pay to make up the difference between unemployment insurance and current wages. The company said it also will work with government officials to access transition benefits.
“We are saddened to learn of Rubbermaid's decision to close its Greenville operation next year,” Greenville City Manager Steven Alexander said in a prepared statement. “For the past 30 years, Rubbermaid has been an important part of our community as well as one of our largest employers. The city of Greenville has been a strong supporter of the company and has worked with Rubbermaid's management over the years to assist in their success through tax abatements and economic incentives.”
Newell Rubbermaid had invested in Greenville to move production there from other operations over the past several years.
Newell Rubbermaid also will close its Wooster, Ohio, distribution location, affecting about 110 employees. The firm closed a big molding operation in Wooster several years ago. The distribution functions will be taken up in nearby Mogadore, a spokesman confirmed, but he provided no further details.
A local newspaper reported that the lease at Wooster will expire and the company wants to save on transportation costs incurred between Mogadore and Wooster. The distribution rearrangement will go into effect late next year and will result in about 25 net jobs being lost, according to the report.
The Greenville and Wooster closures are part of a renewal project announced by Newell Rubbermaid on Oct. 28 when it released its third-quarter earnings report. At that time, the company said only that it planned to close two manufacturing and two distribution facilities. A spokesman said last week that the Greenville and Wooster closures were alluded to in the announcement, but he declined to identify the other two operations slated to close.
Newell Rubbermaid provided more details on its assets realignment in mid-November. It is consolidating its three operating groups into two: Newell Consumer and Newell Professional. Its 13 global business units will shrink to nine, effective Jan. 1.
Newell Consumer will comprise “home organization and style, writing and creative expression, fine writing, and culinary lifestyles.” Heading the units will be group President Penny McIntyre.
Newell Professional will consist of “commercial products, construction tools and accessories, labeling technology and integrated solutions, and industrial products and services, headed by group President William A. Burke III.
The other global unit, Newell Baby & Parenting, will report directly to Newell Rubbermaid President and CEO Michael Polk
A report in the Ravenna, Ohio, Record-Courier said Newell Rubbermaid is interested in setting up a facility in Brimfield, Ohio, where InSite Real Estate of Chicago plans to construct a building. A Newell Rubbermaid spokesman said the company does not comment on speculation and rumor.
Newell Rubbermaid reported a 5.8 percent increase in sales in its third quarter to $1.55 billion. It had a net loss of $177.6 million compared to profit of $28.3 million a year earlier. Restructuring charges will amount to $90 million to $100 million by the end of 2012. Realigning assets will save it $90 million to $100 million per year.