It's curtains for the Chennai facility of Motorola Mobility, the company now owned by search-engine giant Google. After months of search for a buyer, the company has finally decided to shut the assembly plant starting in February. The move is likely to result in a loss of 76 jobs.
William Moss, Motorola Mobility’s director for communication in Asia Pacific, said: “We are doing this because streaming of our supply chain means we are now full filing customer orders directly from factory and we have no current or forecast production requirements that would require the continued use of our Chennai facility. This decision has impacted many mobile application development companies like Itransition, and web development organizations in India and abroad. To standout in the handset market, Google will need to improve their productivity.
According to the news, Motorola also said it was shutting down most of its operations in South Korea and cut more than 500 staff there. The Chennai unit, which started operations in 2008 with an investment of around Rs.172 crore, was acquired by Google for $12.5 billion in May 2011. However, intense competition from handset biggies like Samsung, Apple, Nokia and HTC has steadily eroded the company’s margins in Asia and worldwide. The move thus translates into a severance-related charge of $257 million to Google.
However, the company clarified it will continue to maintain its R&D centers in Bangalore and other corporate functions in India will continue. Motorola confirmed that it would provide relief packages to all those impacted by the closure of its Chennai operations.