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Lenovo will slash 450 China jobs in move to cut expenses
By Zhu Shenshen |
February 26, 2009, Thursday
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Print Edition
Print Edition
LENOVO Group Ltd will cut 450 jobs in China to reduce costs and return to profitability in 2010, Lenovo said yesterday.
The reduction is in addition to the 2,500 global layoffs it announced early this year.
Lenovo, the world's fourth-largest maker of personal computers, will eliminate 450 positions in China that support its global operations, the company said.
"The move will help Lenovo become more competitive and it is a necessary part of our response to the global economic downturn," Lenovo said in a statement.
Hong Kong-listed Lenovo's share price increased 0.70 percent to close at HK$1.43 (18 US cents) yesterday as the key Hang Seng index gained 1.61 percent.
In the fourth quarter, Lenovo posted a US$96.7-million loss, the biggest in at least three years, against analyst estimates of a US$58-million loss. The company's 2007 third and fourth quarter profit amounted to US$172 million and US$140 million.
Lenovo's major clients are overseas and the company has been hit hard by the global economic downturn. The crisis has prevented most firms from increasing IT spending.
Lenovo earlier announced it would slash 2,500 jobs globally, or 11 percent of its total employees by March 2010, to save about US$300 million. The company has also cut executive pay and consolidated its China and Asia-Pacific operations into a single division as part of its restructuring plan.
Lenovo, which spent US$1.25 billion to acquire IBM's PC business, had about a 7.5-percent share of the global PC market last year when it was overtaken by Acer, according to research firm IDC.
Liu Chuanzhi, co-founder of Lenovo and a veteran in the Chinese IT industry, returned to the company as the chairman after the company posted the loss.
Lenovo aims to expand in emerging markets, including China, Russia and Brazil, Liu said previously.
The reduction is in addition to the 2,500 global layoffs it announced early this year.
Lenovo, the world's fourth-largest maker of personal computers, will eliminate 450 positions in China that support its global operations, the company said.
"The move will help Lenovo become more competitive and it is a necessary part of our response to the global economic downturn," Lenovo said in a statement.
Hong Kong-listed Lenovo's share price increased 0.70 percent to close at HK$1.43 (18 US cents) yesterday as the key Hang Seng index gained 1.61 percent.
In the fourth quarter, Lenovo posted a US$96.7-million loss, the biggest in at least three years, against analyst estimates of a US$58-million loss. The company's 2007 third and fourth quarter profit amounted to US$172 million and US$140 million.
Lenovo's major clients are overseas and the company has been hit hard by the global economic downturn. The crisis has prevented most firms from increasing IT spending.
Lenovo earlier announced it would slash 2,500 jobs globally, or 11 percent of its total employees by March 2010, to save about US$300 million. The company has also cut executive pay and consolidated its China and Asia-Pacific operations into a single division as part of its restructuring plan.
Lenovo, which spent US$1.25 billion to acquire IBM's PC business, had about a 7.5-percent share of the global PC market last year when it was overtaken by Acer, according to research firm IDC.
Liu Chuanzhi, co-founder of Lenovo and a veteran in the Chinese IT industry, returned to the company as the chairman after the company posted the loss.
Lenovo aims to expand in emerging markets, including China, Russia and Brazil, Liu said previously.
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