Motorola to cut further 7,000 jobs worldwide

Motorola is to reduce its global personal communications workforce by about 7,000 additional positions.

This brings to 12,000 its total number of job cuts in that sector since December.

Motorola says it will record a charge against earnings for the first and second quarters of its financial year, reflected as a special item. It says the action is being taken as part of a continued effort to reduce costs in its wireless handset business while targeting long-term growth.

The job cuts in the personal communications sector will affect all aspects of the business worldwide, and are expected to be completed in the next two quarters.

Mike Zafirovski, president of Motorola personal communications systems, says: "Unfortunately, this was a necessary next step for us to achieve renewal and stay competitive in today's dramatic business environment, particularly given the current slowdown in the economy.

"We are committed to becoming the most cost-competitive enterprise in the industry in order to help grow our market share. We anticipate growth, but at a slower pace".

"We must continue to adapt our overall cost structure, workforce and production levels to a more competitive business model. At the same time, we will continue to develop and deliver compelling new products and technologies to ensure the long-term health of our business."

Motorola says its personal communications unit reduced its overall supply chain during the last two quarters, closing some factories and establishing global supply agreements with outsourcing companies to reach a balance of internal and external production.

Zafirovski says: "We grew our share of global shipments by approximately one percentage point, to 14.4%, between the third and fourth quarters of 2000, and this was the first increase in a number of years."

Motorola says it plans to introduce compelling new products, significant new customer relationships and strategic alliances in the near future.