Kodak shifts digital camera production
By Li Jian (China Daily)
Updated: 2006-08-03 10:28
SHANGHAI: Eastman Kodak Company, the world's largest photography firm, will
shift the manufacture of its consumer digital cameras, including from its
Shanghai unit, to Flextronics International Ltd as part of a cost-cutting
strategy.
The agreement was sealed on Tuesday following Kodak's seventh
straight quarterly loss and a cut to its full-year revenue forecast, as the
company finds the move into digital cameras to be more challenging than
expected.
Flextronics is an electronics manufacturing services provider
based in Singapore.
Under the agreement, Flextronics will take over Kodak
Electronics Products Shanghai Co Ltd and the Kodak Product Centre Japan Ltd in
Chino and Yokohama, Japan. Flextronics will also manage the operations and
logistics service for Kodak's consumer digital cameras.
"This is another
move in Kodak's overall strategy to further drive improvement for profitability
and efficiency in the operating model of our consumer digital business," said
John Blake Jr, general manager of Kodak's Consumer Digital Imaging
Group.
Tian Geng, spokesman for Kodak (China) Co Ltd, told China Daily
yesterday that the shift does not mean Kodak will quit the consumer digital
camera business. He said it would bring greater flexibility and cost efficiency
to strengthen Kodak's leadership in the market.
"We still maintain the
design and development functions," said Tian. "We will strengthen our efforts on
the advanced design and technical solutions in the field.
"We will launch
new models much quicker in the future, at a lower price."
The
manufacturing shift will see 550 jobs moved to Flextronics, including around 200
employees from its Shanghai plant.
Tian said Kodak has no plan to cut jobs in
China during the shift to Flextronics, but a job cull is beginning to take shape
as a result of its losses.
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