Motorola to close Singapore handset plant

Motorola is to close its Singapore handset production plant by the end of the year, cutting 700 jobs.

A company spokesperson said the closure was part of a global program to reduce annual costs by $500 million.

Motorola would maintain its Asia-Pacific headquarters and its handset R&D facility in Singapore, the official said.

The US phone-maker will begin scaling down its production in the second quarter and will shutter its production and distribution centers by the end of 2008.

Production will be transferred to other regional plants in Tianjin, China, and elsewhere.

The struggling handset maker lost its position as second largest phone-maker last year to Samsung, thanks to a lack of fresh popular handsets.

CEO Greg Brown has warned the recovery will take longer than expected, and has just announced plans to split the networks and handset divisions into separate companies.

Despite the cutbacks, Asia was still a critical part of Motorola's rebuilding program, the official said.

"The importance of the market hasn't changed. Asia is still a big chunk of Motorola's business."