Motorola cuts 7,000 more jobs

Motorola has confirmed it would cut an additional 7,000 jobs as part of an overall restructuring programme.

Motorola has confirmed it would cut an additional 7,000 jobs as part of an overall restructuring programme.

The job cuts will affect all business units, the company said, including manufacturing, research and development, sales and corporate headquarters.

However, the company's wireless infrastructure division will suffer the brunt of the layoffs, where some 3,000 jobs will be cut.

Many of the layoffs will occur in North America, but Europe and Asia will also be affected.

Following the job cuts, the company expects to have about 93,000 employees in total.

Motorola executives were quick to point out that the layoffs and restructuring were not a reaction to the economy, but rather part of a longer-term plan put in motion in 2000, when the company boasted some 150,000 employees.

At that time, the company decided to reduce its overall breakeven cost structure by more than 20%.

The company said that it decided to further reduce its breakeven cost, however, resulting in a new round of layoffs. The restructuring is part of what Motorola is calling its "asset-light semiconductor business model".

In a statement Motorola said that it wants to take its business back to its mid-1990s size, before the "excesses of the telecom and dotcom booms".

"We feel like we have the business sized to the market we see over the next 18 months," Motorola president and chief operating officer, Edward Breen said.

Motorola plans to boost its broader base of businesses, including two-way radio products, public safety systems, cellular handsets, mobile communication networks and embedded semiconductor solutions for wireless communications.

The company also estimated that sales for the quarter would reach or slightly exceed $6.4bn (£4.2bn).

Operating results for the second quarter will result in a loss of four cents per share, although Motorola predicted positive operating cash flow for the quarter.

Despite predicting a sales decline of 5% to 10% for the full year 2002 compared with last year, Motorola estimated that it will post earnings of four cents per share for 2002.

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