European electronics manufacturing services firm Elcoteq SE has decided to launch an intense global restructuring plan that will see one of its China facilities close.
"When the market situation is as tight as it is at the moment, many companies start outsourcing more. The hard decisions we are making now will prepare us to be cost-competitive and ready to grasp these new business opportunities," stated Jouni Hartikainen, president and CEO of Elcoteq.
The company states it is preparing for the "exceptionally uncertain market situation and general economic development in 2009" as it plans to close its Shenzhen facility and consolidate its processes with its Beijing operation. Elcoteq says it will maintain its global footprint and continue manufacturing operations for its customers in Mexico, Brazil, Estonia, Hungary, China and India while trimming its global workforce by about 5000 personnel. The company currently employs approximately 21,000 persons worldwide.
Outside of China, plants will close in Arad, Romania; Richardson, United States; and St. Petersburg, Russia.
The plan targets annual global savings of up to EUR100 million. The savings will start having a positive effect gradually from the second quarter of 2009 onwards and will significantly improve Elcoteq's full-year profitability.
