Motorola Closing Chinese Plant, Downward Spiral Continues

When Motorola (NYSE: MOT)’s shutting down a plant in China, the very mecca of handset manufacturing, you know things are headed downhill. Motorola’s CEO has a big incentive to pull himself up by the socks and fix the situation, and perhaps mitigating manufacturing costs will be one way to do it.

The cell phone sector will be integrated into production lines in Tianjin Motorola after the first quarter of this year,” said Chen Lei, spokesperson, Motorola China, adding that “Hangzhou Motorola will instead focus on TV set-top-box business as well as broadband and mobile network equipment.”

“The integration of the cell phone production also helps Motorola to lower its costs as the handset industry is better off in Tianjin than Hangzhou,” said Zhang Ying, vice-president, Analysys International, a leading advisor for technology, media and telecom industries in China.

Downsizing is bound to happen in this economy, but it seems like changing manufacturing plants is just a way to stem spending rather than really get them out of the rut. What Moto really needs is an awesome Android handset; the ZN300, i465, and a couple generic sliders are not going to save them.

[via Cellular-News]