National Semiconductor Corp Monday announced job cuts at its fabs and plans to dispose of certain manufacturing equipment in an effort to cut costs and rationalize its capacity. 

Approximately 200 positions will be eliminated from the analog company’s worldwide manufacturing facilities, costing National some $20 million in charges.

The Santa Clara, Calif-based company owns 3 wafer fabrication facilities, located in Arlington, Texas; Greenock, Scotland; and South Portland, Maine. National said most of the job cuts will impact Arlington, which primarily runs 150-mm wafers and recently ramped up production on a new 200-mm line, and Greenock, which runs 150-mm wafers, while a small number of positions are to be affected in South Portland, a 200-mm wafer facility. The eliminated positions include both direct and indirect labor, manufacturing jobs, as well as managerial, staff, and support positions.

“Our future growth will be driven by higher-performance, energy-efficient analog products, more and more of which will be produced on 200-mm wafer technology,” said Brian L. Halla, National’s chairman and CEO, in a statement. “This action today aligns our manufacturing capability with our future needs.”

Of the $20 million charge, roughly $12 million is related to severance costs for the eliminated positions, approximately $7 million is related to the impairment and disposal of manufacturing equipment, and about $1 million is related to contractual and other obligations. National said that most of the charges will be recorded in the current quarter, its fiscal Q3. The company said that the actions will result in a fiscal Q4 and fiscal Q1 2009 savings impact at roughly 1 percentage point of gross margin in each quarter.

The company currently employs approximately 7,600 people worldwide, with more than 400 employees each in Arlington and Greenock, and more than 500 employees in South Portland.

By: DocMemory
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