Poser Over Fate of Dell Operations in Malaysia

By Marina Emmanuel

THE fate of the world’s second-biggest personal computer (PC) maker Dell Inc’s operations in Malaysia is unclear, in the wake of news reports on Friday that the American technology giant is considering to sell its factories.

The PC maker has a manufacturing facility in Bukit Minyak on mainland Penang where more than 1,500 people are employed.

Dell also operates a call centre on Penang island, at the Bayan Lepas Free Industrial Zone, where over 1,000 people work.

The Financial Times this weekend reported that Dell had approached contract manufacturers – companies that make electronics equipment on behalf of name-brand groups – about taking over the plants.

“The original story is not based on any announcement by Dell, and we typically don’t comment on rumour or speculation,” a Dell spokesman in Penang told Business Times when contacted.

“We have said many times there are opportunities to use third- party manufacturers to reduce costs and increase efficiency. How best to do so is being evaluated,” he added.

In a memo emailed to all staff worldwide, Dell president for global operations Mike Cannon sought to address employee concerns and questions following the “speculative” news report.

“Here is what we are doing …We continue to evaluate and optimise our global manufacturing and distribution network, including our relationships with original design manufacturers, to better meet customer needs and reduce product cycle times.

“Our goal is to introduce the latest relevant technology more quickly and to rapidly pass on component cost-savings to our customers worldwide,” he said, adding that Dell is also actively reviewing all aspects of its logistics, supply chain and manufacturing footprints.

“We recognise that these are complex issues, and depending on what decisions are ultimately made, they could have a significant impact on some employees and communities.

“We are working through these issues carefully and thoughtfully, and we are committed to communicating with you in an open, honest and timely manner,” Cannon said in the memo.

The history of Dell’s manufacturing presence in Penang dates back to 1996. The Bukit Minyak facility is engaged in producing desktop and laptop computers, along with PC systems.

(c) 2008 New Straits Times. Provided by ProQuest LLC. All rights Reserved.