Avco to Shut Costa Mesa Office, Eliminate Jobs

Consumer finance giant Avco Financial Services, which has been acquired by a Texas-based rival, will close its headquarters in Costa Mesa, eliminating most of the 200 jobs there as part of a major consolidation, its new parent said Thursday.

The move by Dallas-based Associates First Capital Corp. will deal Orange County a double blow, eliminating jobs and a high-profile corporation whose presence for three decades has helped business recruiters attract other companies to the county.

Avco employees have been anticipating some consolidation since the company’s former parent, Massachusetts-based Textron Inc. decided to sell the company in August to Associates First in a $3.9-billion deal. The purchase was completed Wednesday.

“It’s kind of a relief,” Avco technical writer Scott Flanders said after the job cuts were announced Thursday morning. “It’s been hanging in the air for several months.”

Under the consolidation, which is designed to help Associates cut $200 million in costs, 425 of Avco’s 8,000 employees worldwide will lose their jobs, Associates said. Avco’s Denver loan-processing office will close by March, and its 200-person staff will be eliminated.

Associates also said it will consolidate overlapping operations in Britain and Canada.

In Irvine, Avco Technology Center will close in the third quarter this year, after the information systems are converted to Associates systems in Dallas. But the center’s 200 employees will be offered similar jobs by Electronic Data Systems Corp., a Texas-based information technology and consulting services company that said it has worked out an agreement with Associates to employ those workers.

The future is less certain for employees at Avco’s Costa Mesa headquarters, which is scheduled to close by the end of March. Associates said employees may interview for jobs at the firm’s other offices in Dallas or South Bend, Ind. Associates will also help workers try to find jobs in Orange County, spokeswoman Sandra Allen said.

Job losses there will impact workers with a variety of skills, from secretaries to Chief Executive Warren Lyons, who announced his resignation Wednesday after 13 years with the company. He had held the top job since 1995.

The Avco deal is one of a number of consolidation moves in the financial services industry.

Associates has been buying smaller financing companies since being spun off from Ford Motor Co. last year.