Motorola to cut mobile manufacturing costs to improve profits

Motorola to cut mobile manufacturing costs to improve profits

US based mobile phone maker Motorola has said that they are now planning cut the manufacturing costs of their cheap mobile phones by about $2 to $5 per handset to improve profits.

Motorola Chief Executive Ed Zander said in a statement: “We want to make sure our costs at the low end give us the profitability. It’s not just materials costs, its designing for costs.”

Motorola is the second largest maker of mobile phones in the world after Nokia. This announcement comes at a time when Motorola has just revealed that they expect their fourth quarter earnings and revenue to fall.

The company said that they are somewhat struggling in the market due to lack of higher end phones and strong competition in the cheap handset market.

Zander added: “We’re actually going to turn down some deals. I don’t know what it will mean for market share. I don’t really care in the short term. Every time you fall off the horse like we did in (the fourth quarter), you don’t just end up doing the same stuff. We’ve got to get discipline back that every product we make we make money on.”