Intel Corp., the largest computer chipmaker in the word, has announced to shut down factories in Philippines, Malaysia, and US, affecting nearly 6,000 workers.
In a statement released by Intel, it said that not employees will be laid off as some will be offered with positions from other facilities.
Despite decades of operation in Cavite, Philippines, Intel announced to close its operation in this province to cut cost amidst slumping sales. Meanwhile, facilities in Penang, Malaysia and Santa Clara and Hillsboro, Oregon will also be shut down.
While the date remains tentative, the company said that all facilities will be closed before the end of this year.
According to Intel, the plan to close facilities is a decision to cushion the impact of plummeting sales by cutting costs, saying that “current market” should be given high consideration in order to maintain its operation.
Last week, Intel released its sales report which revealed a steep decline in the fourth-quarter of 2008, slumping to $234 million, or 90 percent decline compared to previous year.
The plummeting sales is a ramification of market-to-market transaction decline as consumer demand for computers is low.
Meanwhile, the company warned that slow growth and slumping sales will continue in the first-quarter as the ongoing economic recession is expected to be protracted and deep.
The fourth-quarter revenue of Intel in 2008 has been estimated to reach $7 billion.
Analysts earlier said that technology industry is one of the most greatly hit by the ongoing crisis as consumers will spend less on electronics and things deem to be dispensable.
Internet technology is another economic sector reeling from recession, with online retail giant eBay experiencing sharp decline as consumers spend less.
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