Mobile Phone Reviews
 
 
Motorola reduced manufacturing cost of mobile phones

Mon, 05 Mar 2007

In order to increase its profit margin, Motorola, the second largest mobile phone manufacturer, is planning to reduce the manufacturing cost for some of their cheaper handset from £3.50 to £2.50 per mobile phone .

According Ed Zanderto, Motorola's chief executive, "Cost management will be a key part of Motorola's phone design process. We want to make sure our costs at the low end give us the profitability."

"Its not just materials costs, it's designing for costs," he said.

Zander's comments follow weaker than expected fourth quarter earnings and revenue, which Motorola puts down to the lack of highly developed mobile phones from the company and strong competition for low end phones sold.

Chief financial business officer David Devonshire said, "Motorola would turn its focus to profitability over gaining market share as the company was facing a "rocky" first half of 2007 before it sees improvements in the second half."

Zander said, "Motorola would go so far as turning down business if a deal meant profits could be hurt."

"We're actually going to turn down some deals. I don't know what it will mean for market share. I don't really care in the short term," he said, noting that Motorola needed to change its priorities.

"Every time you fall off the horse like we did in [the fourth quarter], you don't just end up doing the same stuff," he said.

"We've got to get discipline back that every product we make we make money on."
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