Dell to save $3 billion, shut Austin plant, cut jobs

Reuters ^ | 3/31/08 | Philipp Gollner

[kiriath_jearim]

SAN FRANCISCO (Reuters) - Dell Inc (DELL.O: Quote, Profile, Research) said on Monday it plans to save $3 billion annually over the next three years by closing its Austin, Texas desktop computer manufacturing plant and cutting thousands of jobs.

The company's shares rose 1.1 percent following the announcement after closing up 1.6 percent on Nasdaq.

Dell, the world's second-largest PC maker after Hewlett-Packard Co (HPQ.N: Quote, Profile, Research), also repeated its goal of cutting 8,800 jobs, or about 10 percent of the work force, and said it will review "ownership alternatives" for its Dell Financial Services business.

The company said it had already eliminated 3,200 of the targeted jobs.

The Round Rock, Texas-based company also said it would reduce costs in design, manufacturing and logistics, materials and operating expenses.

Dell announced the plans as it prepares for its first analyst meeting in three years. Analysts have called on Dell to cut costs more aggressively as profit margins have narrowed.

The financing-business review should be completed by Dell's fiscal third quarter, the company added.

[allmendream]

Yep. Nevermind that more employment money is ‘insourced’ by foreign companies hiring U.S. workers than is ‘outsourced’ by U.S. companies to foreign workers. Cut off your nose to spite your face.

[dan1123]

I don’t think our trade position would do well with a 30% tariff. However, hiking import fees for added inspections would be a no-brainer. This should have been done in the middle of all the toy/toothpaste/dog food recalls late last year.

[quark]

Ha, ha, ha...serves the left-wing puke Austin community right that their jobs are being outsourced...unspoken in the article, but is most likely what's occurring..."Dude, you are getting a Delhi!"

[mysterio]

Wouldn’t want Americans to actually have good paying jobs.

[cubreporter]

It’s a MAC for us next go ‘round. Still using one we bought over 15 years ago.

[jas3]

Yep. Nevermind that more employment money is ‘insourced’ by foreign companies hiring U.S. workers than is ‘outsourced’ by U.S. companies to foreign workers. Cut off your nose to spite your face.

Exactly. We will all be richer when we kick Nissan out of Mississippi and fire the 4,000 traitorous Americans who dare to work there for a *FOREIGN* company. How dare they?!?!

jas3

[allmendream]

Nevermind that the U.S. workforce is the most industrious, productive and highly paid workforce in the world. Lets make sure we keep all the crappy jobs too! Even if it could be more cheaply done by a guy in India with 20 minutes of instruction! That job belongs to AMERICA!

This kind of protectionism is what I expect from France. MAN UP and be AMERICANS. We don't need protectionism to compete. WE DRINK THEIR MILKSHAKES!

[river rat]

Headline should have been:

Dell announcement cheers Apple

[river rat]

The IBM ThinkPads were being built in China for YEARS before the sale to Lenova...

I've never owned any “notebook” but IBM or Lenova — and have never experienced ANY problem with them.....

They're lightweight, thin, have a small footprint yet are the ROCK OF GIBRALTAR for reliability and favored by “road warriors” whose notebooks see very harsh service!

In the interest of FULL DISCLOSURE -- I'm retired from IBM after 37 years of interesting and challenging experiences.

However -- due to my addiction to iPods and such ---- I suspect I will be ADDING an Apple to the household inventory of machines....

[river rat]

The IBM ThinkPads were being built in China for YEARS before the sale to Lenova...

I've never owned any “notebook” but IBM or Lenova — and have never experienced ANY problem with them.....

They're lightweight, thin, have a small footprint yet are the ROCK OF GIBRALTAR for reliability and favored by “road warriors” whose notebooks see very harsh service!

In the interest of FULL DISCLOSURE -- I'm retired from IBM after 37 years of interesting and challenging experiences.

However -- due to my addiction to iPods and such ---- I suspect I will be ADDING an Apple to the household inventory of machines....

[allmendream]

http://www.youtube.com/watch?v=URjeS5-NaXY

“I DRINK YOUR MILKSHAKE!”

[river rat]

Whoooops!

Started in my adult beverages a little early today...

[Para-Ord.45]

So you`re familiar with the T20 and R31.

Made in Mexico and Philippines.

I`ve no need for a laptop `cept to run usb to aldl obd I II

to te vehicles.

[Griddlee]

Dell should shut down the factory in Limerick Ireland instead where they employ 3,500.

[davetex]

Huh? Please explain what this has to do with Austin. It’s strictly a business decision made by a company based in Round Rock, and from what I’ve heard so far, that function will be moved to North Carolina. Get a clue, don’t spew.

[american colleen]

You should probably ask the laid off employees if they liked and wanted to keep their 'crappy' jobs. Ask them what they are doing now.

Let's see where these 'crappy' jobs are going to go. My guess is China or India.

Pretty soon all what you call 'crappy' jobs will be shipped overseas - we can't compete with people who are happy with $50 per month salaries - let's see how much money you save buying the goods that were made overseas - not much.

If a company is experiencing a downturn then layoffs occur - but in most cases today, that isn't true. Companies work harder to cut American wages in order to increase their bottom line - whatever happened to putting out a superior product in order to increase your bottom line?

This isn't about protectionism, it's about playing on a level field.

[american colleen]

Thank you Ronald Reagan. They wanted access to the vast American market and he said sure, but open your plant here.

Very different from what's going on today.

Dell will sell computers made overseas to Americans because they pay the overseas workers peanuts.

[davetex]

When did North Carolina become over sea’s? Just asking. My understanding is that it’s a logistics decision to ship out of Miami instead of Houston. It’s not gloom and doom, really.

[american colleen]

I know they have a plant in NC - and I hope you're right that it is a decision regarding shipping logistics - so they'll relocate some/all of the (formerly located in) Austin jobs elsewhere in the USA.

I just hate to see companies cutting positions here and hiring in 3rd world countries.

[allmendream]

And we are winning, on a level playing field or not. No matter how much other nations try to “stack the deck” with Socialism it always ends up biting them in the rear. I grew up in the 80’s when everyone was afraid of Japan. Japan sold us lots of electronic goods, that was the extent of the “Yellow Peril” from Japan. The innovation and invention keeps coming from the U.S.A..

You seem to think that on the playing field, level or not, there should never be any losses. Well some people lost their jobs, this isn't France where a job is a lifetime appointment. If they have any skills valuable to their fellows they will find new jobs. This is, after all, the land of opportunity. Or would you rather we made it into France?