Motorola to trim another 4,000 jobs in bid to slash costs

US mobile phone manufacturer Motorola will shed a further 4,000 jobs, mostly at its Mobile Devices unit, in a stepped-up bid to achieve annual cost savings of 1.5 billion dollars in 2009.


AFP - US mobile phone maker Motorola said Wednesday it would slash an additional 4,000 jobs as part of a stepped-up cost-saving move to remain competitive in a slumping global economy.

The move is part of an overall plan to achieve annual cost savings of 1.5 billion dollars in 2009, the Illinois-based company said as it released preliminary quarterly results showing a loss in the fourth quarter.

Of the latest job cuts, 3,000 will be in the Mobile Devices business and 1,000 positions in corporate functions and other business units.

"The workforce reductions announced today are expected to begin immediately and are incremental to the 3,000 workforce reduction actions previously announced during the fourth quarter of 2008," the company said.

The latest moves are expected to save 700 million dollars in 2009 costs, it said.

"The actions we are taking today in our Mobile Devices business will allow us to further reduce our cost structure and positions us for improved financial performance in 2009," said Sanjay Jha, co-chief executive officer of Motorola.

"Additionally, we are making good progress in developing important new smartphones for 2009 and are pleased with the positive response from our customers to these new devices," Jha said.

Motorola said it shipped some 19 million mobile phones in the past quarter with sales "adversely impacted by continued weakness in end consumer demand and customer inventory reductions."

The company ended the year with a "total cash position of approximately 7.4 billion dollars," according to a statement

The latest actions "will allow us to further reduce costs, improve operating cash flow and help ensure that Motorola remains competitive and financially strong during these challenging times," the firm said.

The company expects a net loss from continuing operations in the range of seven to eight cents share, including one-time charges.

Total Motorola sales for the fourth quarter of 2008 are expected to be in the range of 7.0 billion to 7.2 billion dollars.

In December, Motorola unveiled a series of cost-saving moves, including cutting the base pay of its top two executives and freezing pension contributions.

The troubled US mobile phone manufacturer said co-chief executives Greg Brown and Sanjay Jha had both agreed to a 25-percent decrease in their base salary next year.

Motorola enjoyed success with its popular Razr phone launched in 2005 but has been losing ground since to Apple and Research in Motion as well as other major cell phone makers such as Nokia, Samsung and Sony Ericsson.

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