Hangzhou Motorola Cellular Equipment Co Ltd, a joint venture between Motorola and Hangzhou Eastern Communications Co Ltd, will cease cell phone production at the end of the first quarter of 2009, underlining the extended woes of the US communications giant's troubled mobile phone business.
The mobile phone production line will switch to producing TV set-top boxes in the future, said Chen Lei, a spokersperson of Motorola China. After the first quarter, all Motorola cell phones in the Chinese market will come from production lines in Tianjin.
"The employees of cell phone production in Hangzhou will be directly transferred to the production line of TV set-top boxes, and so far, we haven't got any plan to cut staff or enroll new employees," said Chen.
In February 2008, Motorola purchased the TV set-top box operations of two Hangzhou companies. Hangzhou Motorola said its annual production of TV set-top boxes has doubled to two million units com-pared to a year ago. The company moved into the Binjiang development zone on Feb 21.
According to its fourth-quarter financial report, Motorola posted a yearly loss of $4.16 billion in 2008, and the mobile devices sector contributed more than half of that loss.
In the fourth quarter of 2008, cellphone sales of Motorola plunged by 53 percent from a year earlier to 19.2 million sets, the report said.