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  • NEC Electronics Restructures to Counter Sluggish Chip Mart
  • December 4, 1998 (BOSTON) -- NEC Electronics Inc., a California branch of Japan's NEC Corp., said it is restructuring to counter the effects of the depressed semiconductor market.
    Among its moves is the elimination of about 400 jobs. The company made the announcement Dec. 2.

    The corporate restructuring effort is designed to make the company more market driven, customer focused and cost effective, NEC said.

    The job cuts were done in the company's headquarters offices in Santa Clara, Calif., its manufacturing facility in Roseville, Calif. and in sales offices throughout North America. The 400 jobs are about 13 percent of NEC Electronics' total workforce.

    The company said it is taking the actions to improve its profitability, which has been affected by the worldwide slump in the semiconductor business.

    At the same time, new directions have become a priority because customer demands have shifted to requiring more service and support. This is a result of increased demand for sophisticated system-level integrated solutions from customers.

    According to Hirokazu Hashimoto, president and CEO of NEC Electronics, one of the most significant aspects of the restructuring is the formation of a new Technology Foundation Division. That division is chartered with the development of advanced engineering solutions.

    "The new division will pursue high level system integrated solutions and system-on-a-chip business opportunities," Hashimoto said. "It is an integral part of a leaner organization that allows quicker decision making and more rapid execution of major projects and tasks."

    NEC Electronics said restructuring its organization into integrated market focused divisions will allow the company to quickly adapt and respond to increasing customer demands. It also said the company will be better poised to aggressively compete in the system-on-a-chip market.

    Construction will continue on the company's recently announced US$1.4 billion G-Line manufacturing facility in Roseville, Calif. Planned for completion in 2002, the new factory is expected to be among the most advanced semiconductor facilities in the world and one of the first 300mm fabs up and running.

    (Lori Valigra, Asia BizTech Correspondent)

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    Updated: Thu Dec 3 17:10:30 1998 PDT