During a press conference in Munich, chief executive Ulrich Schumacher said sustained weakness in the global economy and uncertainty in the semiconductor industry led to the stepped up timeline. His company recently posted its eighth consecutive quarterly loss.

Schumacher alluded to the persistent unease created by recent events, such as the war in Iraq and the rise of a flu-like disease in Asia called SARS, as a source of the 3 percent decline in the global semiconductor market during the first quarter. “All in all, this can only mean that the market will continue to be beset by considerable uncertainties,” he said.

Infineon will cut 500 jobs from its corporate layers, such as administration, and another 150 jobs from its Secure Mobile Solutions Group. Transferring and outsourcing will trim another 250 jobs worldwide and lead to other savings.

Schumacher stressed that none of the cuts would affect R&D staff in Germany. “Rather, by financially optimizing our company, we want to provide safe jobs on a long term basis for our 16,000-plus workforce in Germany,” he said.

Sounding a note of optimism during his speech, Schumacher said that in contrast to the dip in chip sales, Infineon has seen a 3 percent rise in sales since January and a 13percent jump year-on-year.

The company also used the meeting to say it has started volume production of its 0.11-micron process technology, cutting the cost of a 256-Mb chip from $6.10 to $5.40. The company is targeting a cost basis of $4.50 by September.

By: DocMemory
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