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BenQ-Siemens fires 1,900 of 3,000 workers


Posted: 23 Oct 2006

After trying for some time to save aspects of the Munich-based BenQ-Siemens handset business manager declared that 1,900 of the firm's 3,000 workers must be laid off.

There is a possibility that the remaining workers could thrive as a handset development and design house for third-party manufacturers. As a result the new business would preserve 1,100 German jobs in case it is profitable.

German unions are angry on how things turn out to be and utter imprecations on Siemens AG, the company that “sold” its handset business to Taiwan-based BenQ Corp. with a $303 million payment. The unions say Siemens knew the handset business was failing and that saling it to BenQ was a method to abdicate responsibility for eventual job losses.

Siemens created a $45 million fund for supporting and retraining fired workers at BenQ-Siemens, but the IG Metall labor union demanded that Siemens provide $250 million for the fired workers. Siemens said they have done their role and that others have to help.

BenQ Corp. loss is about $135 million and the annual loss about $478 million.

BenQ's profit dropped after delays in delivering handsets. Analysts, are projecting that BenQ's losses will slow and that the company will return to profitability next year as it recovers from jettisoning failed mobile phone units in Germany and Latin America .

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