Monday, June 4, 2007

EXPENDITURE STRATEGY - FLEXTRONICS

Flextronics International Ltd, maker mobile of phones for Sony Ericsson Mobile Communications and the Xbox 360 game console for Microsoft Corp, agreed to buy smaller rival Solectron Corp. for about $3.6 billio

1. Flextronics may eliminate as many as 1,500 jobs.
2. It has moved production to lower-cost countries such as India to improve profitability
3. It will close some factory space in North America and Western Europe.

4. The combination will generate at least $200 million in after-tax cost savings in 18 to 24 months.

This is the cost saving trend: cut jobs, close factories, move to cheaper locations

[Click here for full story at: BLOOMBERG.COM]

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