Motorola cuts job, affects China plants

Motorola Mobility Holdings Inc, the cellphone manufacturer bought by Google last year for $12.5 billion, said on Monday that its global job cuts will affect China, without specifying how many posts will be lost in the country.

The company announced on Monday that it is reducing its global headcount by about 4,000.

One-third of the job cuts will be in the United States, according to a Motorola Mobility statement e-mailed to China Daily.

In addition, Motorola plans to close or consolidate about one-third of its 90 facilities worldwide.

Dennis Woodside, who previously led Google's sales and operations in the Americas and is now Motorola chief executive officer, said Motorola Mobility plans to leave unprofitable markets, stop making low-end devices and focus on several cellphones instead of dozens. He made the remarks in an interview with The New York Times.

In addition to the coming cuts, the company will downsize its operations in Asia and India, and focus its research and development in Chicago, Sunnyvale and Beijing, the newspaper reported.

"Motorola expects this strategy to create new opportunities and help return its mobile devices unit to profitability ... Motorola is committed to helping (employees) through this difficult transition and will be providing generous severance packages, as well as outplacement services to help people find new jobs," said the company statement.

Si Xuanjun, China public relations manager of Motorola Mobility, said the job cuts will inevitably affect its Chinese operations.

Employees in research and development, marketing and production may face layoffs. But he said he has no idea about how many employees might be affected.

"We are making the changes in the hope of a comeback," Si said.

He said Motorola Mobility will simplify its product portfolio to provide a few flagship mobile phone models each year.

Woodside told The New York Times that he plans to cut the number of devices Motorola makes from the 27 it introduced last year to just a handful.

He wants to make the company's products attractive again by loading them with features like sensors that recognize who is in a room according to their voices, cameras that take crisper photos and batteries that last for days.

China is Motorola Mobility's second-largest smartphone market after the United States. It also set up its largest manufacturing base in Tianjin in 1992, one with more than 10,000 employees.

The Tianjin factory is a mobile phone manufacturing base for Motorola Mobility. In addition to supplying products to the Chinese market, the factory also ships products to Europe and North America.

Analysts said that reducing the number of devices it offers could affect Motorola's standing in China's fierce smartphone market.

A Motorola Mobility management official in China, who wished to remain anonymous, said the company had started to notice a decline in its market share in China.

China acquired the biggest share of smartphone shipments in the global market in the second quarter, when the nation was the source of 27 percent of the world's 158 million smartphone shipments, according to a report issued by analyst firm Canalys.

"Nokia and Motorola both lost significant ground in China. Among the international vendors, only HTC managed an outstanding performance in the Chinese mainland," said Jessica Kwee, Canalys research analyst.