Microsoft to Close Two China Phone Plants

Microsoft is reported to be planning to close two mobile phone manufacturing factories in Dongguan and Beijing, China by the end of this month. The two plants were previously operated by Nokia and came to Microsoft when it acquired the Finnish phone company last year.

The closure was anticipated when Microsoft announced last summer a major restructuring of its operations which would lead to the loss of 18,000 jobs worldwide (Display Monitor Vol 21 No 29). The company said at the time that the majority of the jobs would be lost through synergies and strategic alignment of Nokia’s Devices and Services business.

The closure of the two Chinese plants will result in the loss of approximately 9,000 jobs though some of the production will be transferred to Vietnam. Increased competition in the smartphone market and rising labour costs in China has forced many phone manufacturers to scale back operations in the region.