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Largest European chipmaker to cut 4,500 jobs

European chipmaker STMicroelectronics is to cut up to 4,500 jobs around the world as part of a cost cutting plan to save over £490m in 2009.

The planned cuts were announced by Carlo Bozotti along with 2008 fourth quarter financial results that showed a £257m net lossfor the period.

"The [cost cutting] actions are a combination of the ongoing restructuring initiatives and new programs that are focused on resizing the company's manufacturing operations and streamlining expenses," Bozotti said in a statement.

All product areas were negatively affected, in particular automotive, wireless and computer peripherals, but STMicroelectronics had grown revenues faster than the overall semiconductor market, he said.

Current uncertainty in the global financial markets, economic recession, seasonality, and the effect on demand for semiconductor products makes it extremely difficult to accurately forecast product demand, according to Bozotti.

STMicroelectronics is one of the latest chip manufacturers to announce job cuts after poor results in the last quarter of 2008.

Falling demand for PCs has hit several large chip manufacturers, including Intel, AMD, Texas Instruments and Samsung.

Texas Instruments is to cut 1,800 jobs and shed 1,600 more staff through voluntary retirement, Intel plans to shed up to 6,000 jobs in 2009, and AMD is to cut 1,100 jobs this year.

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