BenQ mobile business faces closure in Germany

28th September 2006, Comments 0 comments

28 September 2006, MUNICH - German electronic giant Siemens AG's German mobile phone handset business could be facing closure following the announcement Thursday by its new owners, Taiwan-based BenQ Corp, that it was considering applying for the unit's insolvency. About 3,000 jobs have been placed at risk by the move, which comes one year after the Taiwanese consumer electronics group took over the loss-making Siemens mobile phone handset operations. The board of BenQ decided Thursday to end investing in i

28 September 2006

MUNICH - German electronic giant Siemens AG's German mobile phone handset business could be facing closure following the announcement Thursday by its new owners, Taiwan-based BenQ Corp, that it was considering applying for the unit's insolvency.

About 3,000 jobs have been placed at risk by the move, which comes one year after the Taiwanese consumer electronics group took over the loss-making Siemens mobile phone handset operations.

The board of BenQ decided Thursday to end investing in its German mobile phone offshoot, BenQ Mobile GmbH, which has also recently turned in a weak performance in the intensely competitive global mobile phone market.

"Despite progress achieved in reducing costs and expenses, widening losses have made this very painful decision unavoidable," BenQ chairman K.Y. Lee said.

BenQ plans to continue production of its BenQ-Siemens brand mobile phones in Asia, threatening the jobs of 1,400 working in the group's head office in Munich and factories in Germany.

Under last year's deal with Siemens, BenQ said it would guarantee jobs through to the middle of this year.

In July, BenQ said that it planned to cut 10 per cent of its German workforce as part of restructuring its operations in the country.

However, since then reports in the German media said that BenQ planned to shut operations in Germany and to slash the salaries of its top-ranking executives.

The company is also reviewing the financial position of operations in Brazil and other locations.

DPA

Subject: German news

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