BenQ Mobile denies Germany closure

BenQ Mobile, the struggling mobile phone maker, is closing production plants in Mexico and Taiwan, but on Wednesday refused to comment on speculation it could also outsource the work of its last remaining production plant in Germany.

“We are certainly looking at all our sites. But there is nothing to say at the moment,” a company executive said on Wednesday.

BenQ Mobile, which took over the loss-making mobile phone division of Siemens last year, is increasingly losing market share. “BenQ is doing badly. New products did not have any significant success so far,” Thomas Langer, analyst at WestLB, the German bank, said.

A German magazine reported on Wednesday that BenQ was negotiating the plant sale with Jabil, the US group, and Foxconn, the China-based mobile phone manufacturing subsidiary of Hon Hai, the world’s largest downstream electronics contract manufacturer.

However, a senior Hon Hai manager on Wednesday ruled out the takeover of BenQ production plants.

Hon Hai had in the past taken over a production plant of Motorola. A company executive said that while the Motorola deal was struck to achieve long-term co-operation, the same would not be true for a BenQ deal. “It was worthwhile with Motorola, one of the world’s leading mobile phone maker, but we would not consider the same with BenQ,” he said.

BenQ, which announced 520 job cuts in July, wants to break even by mid-2007.