Motorola chip design units move to India, China

Tuesday, 09 March 2004, 20:30 IST
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SINGAPORE: Motorola Inc, the world's second-largest cell phone maker, said on Tuesday it was shutting its semiconductor chip-design units in Singapore, Hong Kong and Taiwan, and moving them to India and China. A total of about 50 jobs would be lost in the move. "We are consolidating our design resources and this is part of our semiconductor product sector," a Motorola spokeswoman told Reuters. "For all three design centres, we are looking at fewer than 50 employees in total." She said the move was partly aimed at trimming costs. The Schaumburg, Illinois, company and its rivals, including number one cell-phone maker Nokia of Finland, have suffered a slowdown in demand for mobile phones and wireless network equipment over the past couple of years. But demand has been picking up in recent months. In January, Motorola posted a higher-than-expected fourth-quarter profit, but sales in the wireless phone unit fell, hit by delays in deliveries of new products offering popular features such as integrated digital cameras and colour screens. Echoing the protectionist sentiments in the US election campaign as American factory jobs flow to Asia, developed Asian centres such as Singapore, Taiwan and Hong Kong are also confronting a loss of jobs to lower cost Asian regions. A typical Singapore factory worker, for example, now earns around $7.14 an hour, compared with 53 cents in China, according a report last year by the Economic Review Committee. Drawn by such low costs, multinational companies -- from telecommunications to footware -- have been turning in droves to India and China, nourishing a massive outsourcing industry.
Source: IANS
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