Lenovo Announces Restructuring Plan, 11% Job Cuts
January 09, 2009
Chinese PC maker Lenovo announced on January 8 that the company will initiate a restructuring plan, including cutting its global workforce by 11%, which means that approximately 2,500 jobs will be eliminated, Reuters reported. The job cuts are slated to take place in the first quarter of 2009. Additionally, salaries and performance-based bonuses for its executives will be reduced by 30-50%.
The restructuring plan aims to offset the company's sales losses due to the slowdown in the Chinese market, which has been a driving force for the company, and company's reliance on the corporate segment, where most companies have been aggressively cutting IT spending. The job cuts, which are expected to save the company US$300 million for the year ending in March 2010, will affect the company's finance, human resources, and marketing sectors, according to the same source.
As part of the restructuring plan, the company also plans to unite its China, Asia Pacific, Russian organizations into one business unit, to be renamed Asia Pacific and Russia, according to Reuters again.