Dell will move its European PC manufacturing operation from Ireland to Poland and lay off workers as it continues its belt-tightening restructuring plan, the company said on Thursday.
About 1,900 employees will be laid off at Dell's factory in Limerick, Ireland, over the next year, with staff reductions starting next month, Dell said. The Limerick facility will continue to coordinate manufacturing, logistics and supply chain-related functions.
Picking up the slack will be Dell's factory in Lodz, Poland, which began producing products such as the Latitude and Inspiron laptops in 2007.
Dell said its Global Innovation Solutions Center and EMEA Command Center will stay in Limerick, and other sales and marketing activities will continue at its Dublin office.
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Dell said the changes are part of its three-year, $3 billion cost-reduction plan that has including a review of its supply chain. Dell has been trying to revamp its business as the direct sales model it pioneered lost effectiveness.
Dell warned in early 2008 that it would cut at least 8,800 jobs in an effort to streamline the company's operations.
Dell has been increasingly trying to move into providing IT services such as infrastructure management to help make up for falling margins on PCs.
Dell's net income and revenue dropped in its third quarter results reported in November, in part due to declining demand. Revenue for the quarter came in at US$15.16 billion, a 3 percent drop compared to its third quarter a year prior, with its net income at $727 million, a 5 percent decline.
“We are proud of our 18-year tenure as a major manufacturer in Ireland,” said Sean Corkery, vice president of operations, EMEA. “This is a difficult decision, but the right one for Dell to become even more competitive, and deliver greater value to customers in the region.”
“We will treat affected employees with dignity and respect and offer them every practical support through this extended transition period to minimize the impact on them,” said Corkery. “We appreciate the support from the Irish government and the people of Limerick over these many years.”