LONDON (CNI)--Dutch group Akzo Nobel announced Tuesday its fibres subsidiary Acordis is moving production of Tencel to the UK from the US with the loss of 96 jobs.
The move comes in response to the Asian economic crises reducing demand and the company trying to boost profitability.
All production of Tencel is being re-located at Acordis' new plant in Grimsby, England. The original US production facility in Mobile, Alabama is to be mothballed. US production of Tencel is to be suspended shortly but the plant is to be maintained in operational condition.
The change in production location to the more efficient plant will also see 62 job losses among support staff, mostly in the UK, said the company.
Folkert Blaisse, chief executive officer of Acordis, said: "Our proposals are designed to restore Tencel's profitability while retaining the flexibility to increase production as demand rises."
Acordis said there is to be a full consultation with employees affected by the strategic plan and with their representatives. It is also to provide counselling support and facilities to seek new employment.