On the early morning of February 10, just after having celebrated the Lantern Festival that represents reunion and peace, Xu Lin (a pseudonym), rushed as usual to work to the Motorola Building in Wangjing, only to be told that her name was on a list of layoffs. Nearly 1,000 of her colleagues received the same bad news.
"I saw many former colleagues leaving the company with an envelope in their hands, looking pale," a Motorola China employee, who wished to remain anonymous, told reporters. He said that although he had not been fired, seeing colleagues leaving still made him sad.
"The company dismissed nearly 1,000 people this time," he said. "They were all from the research and development team of the mobile phone department and the software platform project team suffered the most during the layoffs." The team was originally divided into three groups, each with 150 staff. Now the three groups have been combined and have less than 100 people left.
On the morning of February 11, a spokesperson from the public relations department of Motorola (China) Electronics Ltd. confirmed the downsizing but did not give an exact figure.
"According to Motorola's financial results for the fourth quarter of last year, the company dismissed 4,000 employees worldwide, including 3,000 employees from the mobile phone unit. But that is a global figure, and we do not have specific figures for China and other regions," the spokesperson noted. "Motorola China has offered compensation to employees in accordance with Chinese laws and regulations." Although Motorola has cut staff in China, its commitment to the development of the country and the importance of the global strategic role of the Chinese market will remain unchanged.
This was already Motorola China's second downsizing in three months. The first came at the end of last year when Motorola China's research and development team cut nearly 600 employees out of the total 2,600. While most of the employees involved in the last downsizing were outsourced technicians, this time almost all the sheared staff were formal Motorola employees.
Most Motorola employees were not surprised by the job cut, since previously, on January 15, the company announced that it would cut 4,000 employees worldwide and that about three quarters of them would come from the mobile devices unit. Motorola China decided not to cut jobs until after the Spring Festival holiday, which was drawing near when the announcement was made.
Multinational corporations generally adopt the compensation standard of "(N+1)×monthly wages" for fired employees in China, with N referring to the number of years that a dismissed employee has worked at the company. For example, an employee who has worked 10 years for the company would be eligible for compensation equivalent to as much as 11 month's worth of wages.
However, Motorola has not officially confirmed yet whether it will use this standard. A PR official of Motorola emphasized once again that "Motorola will deal with these matters in accordance with the relevant laws and regulations of China."
Motorola was once a giant in the mobile phone industry. However, the company posted $3.6 billion loss in its updated Q4 2008 financial results. Motorola shipped about 19 million handsets in the fourth quarter, less than half the amount of the same period 2007.
Whether this former mobile phone giant can regain its position by its downsizing still remains a doubt.
According to the Wall Street Journal's analysis, there are usually two ways for a mobile phone manufacturer to maintain profitability: one is product diversification; the other is to focus on a single key product, as Apple Inc. and its iPhone. Motorola does not have an iPhone-like product, and as it has also decided to reduce its product line and to cut staff substantially, it is likely to be in store for more troubles.
By People's Daily Online