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STMicroelectronics cuts jobs, fabs and capex

29 January 2009 | By Mark Osborne | News > Fab Management

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Loss-making STMicroelectronics is planning to reduce its cost structure by more than US$700 million in 2009 as it struggles to return to profit. Approximately 4,500 jobs will go, particularly in its manufacturing operations, as it streamlines.

STMicroelectronics expects to close its 150mm fab in Carrollton, Texas as well as reduce production at its 200mm fab in Pheonix, Arizona to a ‘mini-line.’ Back-end operations in Morocco will close while operations in Malta will be downsized. In Singapore, STMicroelectronics will reduce 150mm wafer capacity and relocate back-end operations to its facility in Shenzhen, China. The streamlining of manufacturing operations is expected produce US$170 million in savings in 2009.

CapEx for 2009 has been lowered to US$500 million compared to US$981 million in 2008, a decline of almost 50%. The company plans to further support its asset-lite plans with a target of a 10% capex-to-sales ratio.

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