Beleaguered Windows PC box assembler Dell “is trying to sell its computer factories around the world, a move to sharply overhaul a production model that was long a hallmark of the PC giant’s strategy but is no longer competitive,” Justin Scheck reports for The Wall Street Journal.
“In recent months, according to people familiar with the matter, Dell has approached contract computer manufacturers with offers to sell the plants. One person briefed on the plan said he expects the company to sell most — and possibly all — of its factories ‘within the next 18 months.’ Other factories could close, this person said. Dell would enter into agreements with the contract manufacturers to produce its PCs,” Scheck reports.
“The Round Rock, Texas, company last week reported disappointing quarterly profit that helped send shares down more than 18%, and has been trying to reduce expenses since early last year,” Scheck reports.
“Dell could face several obstacles to selling its plants. Contract manufacturers may be hesitant to buy factories in places with high labor costs, like the U.S., said one person with knowledge of the talks. And some facilities could be encumbered by agreements with local governments. Dell’s North Carolina plant, for example, received several million dollars of state and local tax incentives that are contingent on the factory meeting certain employment and local-investment goals by 2015,” Scheck reports.
Full article here.
[Thanks to MacDailyNews Readers “Luis E.” and “John M.” for the heads up.]